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Donor Advised Funds (DAF)

Thank you for considering a donation to ArtsWave. The following is intended to answer some of the most frequently asked questions about donor advised funds.

How to Make a Gift

Giving through your Donor Advised Fund (DAF) is easy! Simply contact your sponsoring financial or community institution to recommend a grant to ArtsWave.

Restrictions

The U.S. Pension Protection Act of 2006 establishes certain restrictions applying to donor advised funds. It's important to be aware of these to make sure that a donation through a DAF meets your needs and charitable intent. The restrictions that most often impact donors concern pledges (new and existing), providing multi-year support and accepting donor benefits.

Pledges

When a DAF is established, the donor may recommend but not legally direct future charitable grants. As the donor has given up legal ownership of the fund, they are prohibited from making a pledge from their DAF to the charity they want to support. In addition, donors may not fulfill existing pledges through their DAF.

Intent to Give

ArtsWave recommends that donors notify us of their intent to recommend a grant, as it assists us with future planning. Suggested wording is: "I intend to recommend a grant of [amount] from a DAF."

Donor Benefits

Donating through a DAF limits the donor benefits you may receive. Because a full tax deduction is received at the time of establishing the DAF, donors may only receive "incidental" benefits, or benefits which do not carry a fair market value. Click here to view a list of all ArtsWave donor benefits along with the fair market value of each benefit if applicable.

Other Frequently Asked Questions

Q: Can I reimburse a charity for the value of donor benefits or event tickets in order to receive those services?
A: No. Due to IRS restrictions, reimbursing a charity to receive benefits and services ("bifurcation") is not permitted.

Q: Are there penalties for receiving more-than-incidental benefits for a DAF gift?
A: Yes. The U.S. Pension Protection Act of 2006 imposes an excise tax on any donor, donor-advisor or family member who recommends a grant that results in "more than incidental benefit." The sponsoring agency (such as ArtsWave or Fidelity Charitable) can be penalized as well.

Q: Can a DAF be part of a planned gift?
A: Yes. When establishing a DAF, a qualified charity such as ArtsWave may be recommended to receive any remaining balance in the DAF upon the death of the donor.

Questions?

Please contact Amanda McDonald, Director, Individual Giving with any questions about supporting ArtsWave through a donor advised fund at amanda.mcdonald@artswave.org or 513.632.0131.