With the 2024 tax year ending soon and stock values high, now could be the perfect time to open a donor-advised fund (DAF). At the Jewish Community Foundation of Greater MetroWest NJ, we’re proud to offer DAFs as a service to help our community members do more with their donations – whether reducing their taxes, simplifying their record-keeping, or planning their giving for years to come.
This is also the time of year when we get the most questions about how DAFs work. Maybe you’ve heard of donor-advised funds but you’re not sure what they really are? Or how, exactly, they could save you money and make your giving simpler? Let’s break it down.
What Is a Donor-Advised Fund?
A donor-advised fund (DAF) is a flexible, tax-smart vehicle that works like a dedicated account for your charitable giving. Contribute to the account, receive an immediate tax deduction, and then invest your balance and decide over time which charities you want to support. Think of it as your own mini-foundation—with minimal cost, higher deductibility, and much less hassle.
Why Open a DAF Now?
Opening a DAF before the end of 2024 can help you unlock charitable deductions or avoid taxes on gains from appreciated assets (which is especially valuable if your appreciated stocks have been held for less than a year). It can also simplify record-keeping and reduce your paperwork next year: with a DAF, all your donations are consolidated in one letter at tax time.
Why Set Up a DAF with JCF?
With one of the top-rated DAF programs in the country, JCF offers personalized support from a team committed to Jewish values and philanthropy. And this year, when you open a DAF with us by year-end, JCF will contribute $1,000 to the UJA Annual Campaign on your behalf, adding even more impact.
Once you’ve opened your DAF with JCF, you can:
- Take a 2024 tax deduction and set aside funds for future synagogue dues, emergency relief to Israel, or other gifts to 501(c)(3) charities.
- Eliminate the need to track receipts and consolidate all your giving in one account.
- Invest and grow your charitable balance – while making a meaningful impact on our community.
- Make grants to qualified Jewish and secular charities with ease. You make the recommendation; we deliver the funds.
How Much Money Do You Need to Fund a DAF?
You can establish your DAF with an initial donation of just $5,000. You can complete the application in about 15 minutes – name your fund, identify authorized grant recommenders and successors (with no minimum distributions), and choose how your funds are invested. Once it’s set up, you can start making grants to support causes close to your heart, from your synagogue to emergency relief in Israel to secular charities of your choice.
Still have questions? Join us November 20th or December 11th for a free, virtual info session, led by top experts in tax law and charitable giving.