This sample Fund Activity Policy provides language to include, either, in a stand-alone policy, or to be incorporated into an existing donor advised fund agreement or policy. Within the sample policy are: 1) acceptable types of grant activity, 2) a framework for activating grantmaking, and 3) definitions of terms used in the context of this sample policy.
Donor advised funds have been a part of the federal tax law of charity for nearly a century as a unique philanthropic tool. Because of the relatively small amount needed to start a DAF compared to assets needed to create a private foundation, DAFs serve as an opportunity for middle class Americans to pursue their philanthropy and to gain the benefit of the foundations’ expertise and experience in helping to guide their giving. Use these resources to learn more and gain valuable insight into managing and administering Donor Advised Funds.
These are a few examples of DAFs that are sparking tremendous change in their communities:
Larry Master, courtesy of Adirondack Foundation
In-Depth knowledge on Donor Advised Funds
Council analysis of IRS definition for charitable purpose of donor advised funds.
The Pension Protection Act of 2006 includes the first comprehensive regulation of donor advised funds. These requirements generally took effect at the beginning of the tax year following enactment of the Act, for charities that hold assets in such funds. However, a provision barring the payment from donor advised funds of grants, compensation and similar payments to donors, advisors, and persons related to them took effect immediately on August 17, 2006. Understanding the definition of what is a donor advised fund also is important to the implementation of the Act’s charitable IRA rollover provision because rollovers are not permitted into donor advised funds.
Your giving program looks like a convenient vehicle for fulfilling personal charitable pledges. Here’s what you need to know about when to say “no.”
Council summary of Treasury Department report on donor advised funds and supporting organizations.
In Notice 2007-21, the Treasury Department and IRS requested comments on issues relating to the organization and operation of donor advised funds and supporting organizations, to be included in a study of these organizations. The resulting report includes detailed discussion of the legal requirements for supporting organizations and donor advised funds, an analysis of available statistical information about DAFs and SOs, and more.
This chart details what organizations can and cannot receive grants from donor advised funds.
Information on bringing scholarship funds into compliance under the PPA.
Frequently asked questions about prohibited grants from donor advised funds following the Pension Protection Act of 2006.
Frequently asked questions about disqualified persons for donor advised funds and sponsoring organizations under the intermediate sanctions rules of the PPA.