Donor advised funds – benefits of contributing prior to year-end By Beth Rose, Vice President of Philanthropy and External Relations

The Alaska Community Foundation is adapting to the new tax plan and would like to share some useful information about how 2017 gifts to donor advised funds might be beneficial to some donors. Please note this is not tax advice, and we encourage you to speak with your accountant, tax preparer or other professional advisor before taking action.

Benefits of contributing to your donor advised fund in 2017

The new tax plan nearly doubles the standard deduction for individuals and families. Due to this increase, some charitably minded individuals are considering how and when to make charitable donations, especially when they historically itemized and deducted their charitable contributions.

One suggestion being discussed is that individuals consider opening or make a larger charitable donation to their donor advised fund prior to the end of 2017, thus allowing them to obtain a charitable income tax deduction this year. Donor advised fund holders have the option of making donor recommendations in 2018 and beyond, thus ensuring consistent support for their favorite charities. According to ACF’s Donor Advised Fund activity policy, Donor Advised Fund holders are encouraged to make annual donations from their DAF.

Helpful FAQs:

Q: When is the deadline for contributing to a donor advised fund for a 2017 tax deduction?

The deadline is December 31, but it is wise to donate earlier, particularly since December 31 is on a Sunday.

Q: How can I make my donation?

You can give directly online with a credit card payment on The Alaska Community Foundation website: www.alaskacf.org.  If you wish to mail a check in, please make sure the envelope is postmarked by December 30. If you wish to open a fund, please contact one of our staff members as soon as possible (phone numbers provided below).

Q: What if I wish to make a stock transfer?

Please talk with your broker to ensure that a stock transfer can take place by December 29. If so, inform your broker to transfer stocks using this information:

ACF Custodial Account: Wells Fargo Bank, NA Participant #2027

Agent Bank ID: 94866

Account # 25639600, Alaska Community Fnd General

Institution 94866

Q: When do I receive a tax deduction for a gift to my donor advised fund?

You receive the deduction when you contribute money to the donor advised fund since The Alaska Community Foundation is a qualified public charity. You do not receive another deduction when the money is actually sent to your selected charity since you have already received the deduction.

Q: What if I can’t make a larger donation in 2017?

Some advisors are recommending making larger donations to a donor advised fund every other year to beat the standard deduction and to itemize in those years.

 

This summarizes information provided in The New York Times.

For questions or assistance, please contact:

Nina Kemppel, President and CEO, (907) 274-6702

Beth Rose, VP of Philanthropy and External Relations at (907) 249-6611

Kevin Gray, Chief Financial Officer at (907) 274-6703