In general, contributions to a Donor Advised Fund (DAF) are treated as contributions to a public charity, thus providing donors some advantages over private foundations. For example, donors may claim a higher charitable deduction (up to 50% of adjusted gross income when giving to a public charity vs. 30% to a private foundation). And, DAFs are not currently subject to annual payout requirements that apply to private foundations.
In exchange for this preferential treatment, DAF donors surrender legal control to the sponsoring organization (in this case, Communities Foundation of Oklahoma). At the time a new DAF is established, the sponsoring organization will appoint Fund Advisors who have the opportunity to recommend, but not direct, donations to be made from the DAF. Advisory privileges refer to the right of a donor to provide non-compulsory recommendations, suggestions, or consultative advice.
SPECIAL NOTE: As a public charity sponsoring Donor Advised Funds, we are required to explicitly disclose that donors contributing to a DAF may not impose restrictions or conditions on the assets legally given to the DAF.
Any authorized Fund Advisor (as documented on the current Exhibit A fund document) may recommend a grant distribution from the DAF at any time. Grant distributions can be made to any 501(c)(3) public charity, governmental agency, or organization classified as a church. Grant recommendations need to be submitted in writing or via the DAF online portal (www.cfok.org/portal). Please contact Teresa Rose Crook with all matters related to DAF grant recommendations and questions. 405.488.1450 or firstname.lastname@example.org
Yes! Any current DAF Fund Advisor (as documented on the current Exhibit A Fund Document) may provide recommendations for grants to be awarded to qualifying recipient organizations at any time. Currently, these recommendations may be submitted via email, U.S. Mail, or fax. Authorized DAF Advisors may also enter recommendations directly into our new Donor Advisor Portal by visiting www.cfok.org/portal
To provide DAF recommendations by mail, please address your envelope to Communities Foundation of Oklahoma, attention Teresa Rose Crook, Executive Director, PO BOX 21210, Oklahoma City, OK 73156
DAF recommendations may be faxed to 405.755.0938 or emailed to Teresa Rose Crook at email@example.com
Once received, the CFO team will evaluate each recommendation to ensure the following required conditions are met:
- The recommended recipient exists as a tax-exempt organization in good standing with the IRS at the time the grant is to be awarded. This means the organization is a Public Charity described in IRC 509(a)(1) or 509(a)(2) and verified using the industry-standard Guidestar Charity Check system. Grants may also be made to churches, public schools, and/or governmental organizations provided we are able to document other required information. DAFs are not able to make grants to individuals, for-profit corporations, or Type III Supporting Organizations that are not functionally integrated per IRC 509(a)(3).
- No goods or services will be provided to the DAF Advisor and any donor having contributed to the DAF
- The grant recommendation clearly supports charitable efforts and activities as defined in IRC 170(c)(2)(B).
Yes. CFO offers three pooled investment options. Learn more about the Balanced, Conservative, and Growth pools, and access historical returns, by visiting Financials, Policies and Publications (note: this link opens a new window)
Alternatively, donors may recommend an investment option apart from the three pooled options referenced above. These recommendations must be scrutinized to ensure no impermissible private benefit to the donors will occur AND both CFO's Finance/Investment Committee and the full Board of Trustees must agree and formally vote to approve the recommendation ensuring it aligns with CFO's best interest and exclusive charitable purpose. CFO's Board of Trustees retains final decision-making authority regarding all investments.
Remember that Donor Advised Funds are intended to accomplish charitable purposes rather than to generate fees from securities trading for investment advisors. If any recommended arrangement appears to produce too much private benefit to a financial company, CFO will not be able to approve the recommendation as it could jeopardize our exemption.
Yes. We encourage our DAF accounts to review and routinely update both current Fund Advisors and those appointed to be Successor Advisors in the event all current Fund Advisors become unable to serve in this capacity. Both types of Advisors are documented as part of the Exhibit A Fund Document. Changes can be made at any time by contacting our Executive Director. firstname.lastname@example.org | 1.405.488.1450
In the event all current Fund Advisors become unable to fulfill their duties and no Successor Advisors have been appointed, CFO's Board of Trustees will review options and, if necessary, exercise Variance Powers to redirect remaining funds to a charitable organization that aligns with donor intent.
Not at this time. CFO encourages, but does not require, DAFs to distribute at least 5% of the account's value each year.
No. The Pension Protection Act of 2006 prohibits grants to individuals from a donor-advised fund. Additionally, Section 4966 of the U.S. Code imposes an excise tax on distributions from a DAF to individuals. For these reasons CFO is not able to approve these types of distributions.
Not directly. A scholarship is considered a grant to an individual which is prohibited from a Donor Advised Fund. Additionally, charitable scholarships are closely regulated to ensure various requirements are met. A donor advised fund may recommend a distribution of at least $25,000 to establish a separate Endowed Scholarship at CFO. Please reach out to our Director of Scholarships to learn more. 405.488.1450 or via email email@example.com
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