Donor Advised Funds (DAFs) Simplify Your Charitable Giving

What is a Donor Advised Fund (DAF)?

A DAF is a charitable giving vehicle. You contribute cash and/or assets such as stock and securities. In return, you qualify for an income tax charitable deduction. You can then recommend grants from the fund to The Salvation Army and other charities over time, rather than all in one year, such as to pay charitable pledges.

How The Salvation Army’s DAF Works:

• Contributions: You initially must contribute at least $5,000 or more to open your DAF account. You and others can then contribute gifts of at least $250 once your DAF account is open. Donors qualify for a charitable income tax deduction for the year when you make a contribution.
  
  
• Irrevocability: Once the contribution is made, you can’t take it back.
  
  
• Investments: The assets in the fund are invested, and growth is tax-free. You may have choices among investment options.
  
  
• Granting: You (as donor/adviser) can recommend grants of at least $250 to The Salvation and other charities. A minimum of 50% of your DAF must be granted to benefit programs and services of The Salvation Army. DAFs cannot grant for fundraising dinner tickets, golf outings or other return benefits. You can satisfy pledges to The Salvation Army and other charities from your DAF.
  
  
• Advisors: You may serve as the only advisor on grants from your DAF or you can designate other advisors to join or succeed you.
  
  
• Minimums: Minimums contribution to establish The Salvation Army DAF is $5,000. You can add smaller contributions of at least $250 to the DAF after it is opened.
  
  
• Successor / Legacy Options: You can often designate what happens to remaining DAF assets after your lifetime. The Salvation Army must be named as beneficiary of at least 50% of your DAF account.

Benefits of DAF Giving

Some of the advantages, especially with The Salvation Army’s DAF, include:

• Tax Benefits:
• Immediate tax deduction when you contribute.
• If you contribute appreciated securities, you may avoid capital gains taxes when the assets are sold by the DAF.
• Investment growth inside the DAF is not taxed. 

• Flexibility:
• You can recommend grants over many years, even if you make the contributions all in one year.
• You can choose which charities to support in addition to The Salvation Army.
• Legacy / Planning:
• You can designate beneficiaries of your after death. At least 50% must be designated for programs or services of The Salvation Army.
• You can designated advisors to succeed you so long as funds remain in the DAF.
• Convenience:
• A DAF can simplify your charitable giving, especially if you make many gifts or want to plan to donate over many years.

You may consider rollover of all or part of a private foundation to a DAF and let The Salvation Army manage the administration of the account while you only advise on grantmaking.

Things to Consider

• Once you donate to the DAF, you lose ownership and can’t reverse or take back the gift.
• While there are fees (both administrative fees and investment fees), The Salvation Army’s DAF fees are competitive with other types of donor advised fund fees.
• You as donor only have advisory rights that we will try to follow. The Salvation Armyhas ultimate legal control over grants and investments.

This information is not intended as tax, legal or financial advice. Gift results may vary. Consult your personal financial advisor for information specific to your situation. 

Tax ID Number: 36-2167910

Organization’s Legal Name: The Salvation Army

Gift Designation: Can be done as the donor wishes, and will be documented in the DAF agreement. 

Mailing address for DAF gifts:

The Salvation Army – Midland Division
Attn. Pam Dempski
1130 Hampton Ave.
St. Louis, MO 63139

For additional information, please contact:

Pam Dempski, Director of Philanthropy Pamela.dempski@usc.salvationarmy.org 314-646-3080