Donor Advised Funds
Flexible philanthropy with a global reach
A Donor Advised Fund is a flexible tool for individuals, families, and corporate donors seeking to support nonprofit initiatives across the globe. Claim an immediate tax deduction when you contribute to your fund and then recommend grants to favorite charities at your convenience. With Myriad — the alliance for borderless giving — donors can recommend grants to charities on six continents.
How Does It Work?
Opening your fund
Opening a Donor Advised Fund is simple and straightforward, and there are no set-up or legal fees involved. You can open a fund with a first contribution of any size, for which you may take an immediate and full tax deduction even if you intend to recommend grant distributions at a later date.
You can contribute to your Donor Advised Fund whenever it suits you, and claim an income tax deduction in the year of the contribution. KBFUS can receive gifts by check, wire transfer or credit card, and also gifts of stocks, bonds, mutual funds, real estate and other types of property. Corporations can contribute to their fund from various sources, such as a corporate giving program or a corporate foundation. Individuals can contribute from an existing giving vehicle such as a private foundation or a Donor Advised Fund held at a community foundation or national fund. They can invite friends and relatives to contribute as well.
Investing assets to generate income (optional)
Funds with balances over $250,000 may be allocated to one of two investment pools, allowing them to earn income and grow tax-free over time. In case of fund balances over $750,000, you may recommend that their management be entrusted to an investment advisor of your choice. For more information, please see our Investment Policy Statement.
Making a grant distribution
You can make recommendations for grant distributions from your Donor Advised Fund at any time. KBFUS will contact the recommended grantee to request information on their structure, funding and activities. Our due diligence process helps ensure that grant monies are used for legitimate charitable purposes. The grant will be formally approved by our Board of Directors, and following such approval, a grant agreement is signed with the grantee, specifying the intended use of the grant moneys and requesting a brief report after a one-year period. Upon receipt of the signed agreement, KBFUS proceeds with the payment to the grantee, usually by wire transfer. If you don’t have a favorite organization in mind, we can help you identify premier nonprofit initiatives in the country, region or field of your interest.
For Donor Advised Funds without invested assets:
Each grant distributed from the Fund will be subject to a management fee, calculated as follows:
5% of the first $100,000 of each grant;
3% of the next $400,000;
1% of the next $500,000;
and 0.5% of the amount of each grant in excess of $1,000,000.
For Donor Advised Funds with invested assets:
The Fund will be subject to an investment fee of 70 basis points per year (that is, 0.7% of the Fund’s invested assets – 0.175% assessed quarterly). No fees will be charged on grants distributed from the Fund.
This fee structure is all inclusive – there are no other legal, due diligence or maintenance fees involved.