By Crystal Langdon

www.crystalclearfinances.com 

As you begin the New Year, you often set new goals and realign your priorities. Why not prioritize your giving and plan to make good things happen for New Yorkers Family Research Foundation (NYFRF) this year?

A Donor Advised Fund is an easy and fun way to give. The amount needed to start is relatively small compared to larger trusts or private foundations.

A Donor Advised Fund has all the benefits of a private family foundation, without the legal fees or start up costs; plus, there are no distribution requirements or minimums that you must make. Donor Advised Funds are a flexible tool that allows you to enjoy immediate tax deductions, reduce income taxes, and remove capital gain taxes. You can open a Donor Advised Fund with cash, stocks, bonds, personal assets, business interests, or real estate.

You can start a legacy of giving by creating a Donor Advised Fund in your family’s name and listing NYFRF as one of the beneficiaries. The administration and reporting of the fund accounts are overseen by a third party, and every year you decide the amount that is to be given and which Charities will receive them. Another benefit is that once you place a donation into a Donor Advised Fund it becomes irrevocable, and you receive an immediate tax deduction.

This is an excellent way to create a legacy of giving, as it can be passed from generation to generation. For example, John and Sally Smith desire to incorporate giving as a continual family lifestyle. They want to pass this conviction on to their children and future grandchildren. John and Sally decide to start a Donor Advised Fund through the use of stock that has appreciated over the years, but is providing them with a low-income yield.

By placing this stock into a Donor Advised Fund, John and Sally receive an immediate tax deduction and avoid capital gains on their stock. Every year John and Sally can bless NYFRF with regular distributions from their family Donor Advised Fund. They can continue to add to their family fund, and they have the right to choose the amount that will be gifted from the fund each year. To continue this legacy, John and Sally have requested that in the event of their death, their two children continue this legacy of gifting, and they have listed them as the contingent advisors to the family Donor Advised Fund.

Donor Advised Funds are ideal for individuals looking for immediate tax deductions, the elimination of capital gains tax, and the ability to provide annual gifting for NYFRF.