What is a Donor Advised Fund (DAF) and how does it benefit my client?
A DAF is a charitable giving vehicle sponsored by a public charity (in this case, iGiftFund). When your clients make a contribution to the DAF, they receive immediate and maximum tax benefits. Receiving the tax benefit up-front allows them to recommend grants to their favorite charities over time, on their own schedule. They also recommend who will succeed them as fund advisors over successive generations.
At iGiftFund, we partner with you to make sure your clients have an exceptional experience as they focus on their philanthropic vision, grant making and fund succession.
How does a DAF work at iGiftFund?
DAF’s at iGiftFund have 2 components:
- Investment account at your preferred custodian which you will manage (approx. 99%)
- Liquidity account at iGiftFund (approx. 1%)
The purpose of the liquidity account is to cover small grants and our quarterly administrative fees. The liquidity account is rebalanced as needed.
Once the DAF is set up and funded, your clients (and you, if given the ability to do this), can recommend grants and grantees in DonorView, our online portal. In the portal, grants can be set up as a one-time or recurring, with full, partial or anonymous recognition.
Once submitted through the portal, grants are issued in the form of a check within 5 to 7 business days (many times much sooner, if the liquidity is available and there are no issues with grantee eligibility).
iGiftFund provides quarterly statements. We’re also happy to arrange duplicate statements or set up third-party view-only access for your client’s investment account depending on what your custodian allows.
What are your fees?
Our fees are tiered, starting at 45 basis points (bps) for the first $500K (Min $600/yr).
Click here for the fee scale: Fees and Minimums
What is the minimum initial contribution to establish a DAF?
The minimum initial contribution is $25,000
Additional contribution minimum is $1,000
What is the minimum grant amount?
The minimum grant amount is $100.
Our Grants Team processes grant distributions via check. Grant checks are accompanied by a grant letter and mailed directly to the grantee charity.
Do you have any guidelines regarding investments?
Click here for our Investment Guidelines
Do you have a handout I can share with my client?
Click here to download a PDF of the DAF handout for Donors
Can you do a demo of DonorView for my clients?
Have your clients visit our Donor Hub page. This page is tailored to donors and has the same demo you see below.
DonorView Demo
I would like to speak with someone
Call us at 330.400.2768 or 800.810.0366 or email our Donor Support Team directly at [email protected].
I’m ready to open a DAF with iGiftFund, what is the process?
- Open the Fund by Submitting the Electronic DAF Application to iGiftFund – click the DAF Application button below to complete the form (existing FAs should use the link available to them in the portal).
Prep Work – review our DAF Program with your clients, focusing on key details such as minimum contribution and grant amounts, eligible and ineligible grantees, and administrative fees. This is also a good time to explore Succession Plan options:
- Appointing up to two successor individuals
- Making final grants to up to six charities
- Establishing recurring grants with an endowment plan
Information Required for DAF Application – please gather the following information from your client(s):
- Full name, DOB, address, phone number and email for both the primary and joint donor fund holder. Note that the phone number will be used for Two-Factor Authentication (TFA)
- A 4-digit pin for over-the-phone verification
- Desired Fund name (e.g. Smith Family Giving Fund)
- Succession Plan
- Initial contribution ($25K min) and funding method
Note: The Primary and Joint Advisors in the DAF application should be your clients. Please don’t add the financial advisor information in these fields.
Formatting Reminder: Do not use ALL CAPS when completing the form, as this will affect Grant Letters and other correspondence.
Once you submit the electronic form, your clients will receive an email requesting their signature to complete the process. Keep in mind that the account opening process is not complete until they sign the DAF application. Once signed, they will be onboarded onto the portal.
Click here for our Program Description and Guidelines. Your client(s) will have access to this document when signing the application.
- Open the Investment Account for iGiftFund – You will need our Corporate Documents Packet (Corporate Resolution, Articles of Incorporation, Bank Letter for ACH Authorization,) to complete the LPL forms.
iGiftFund is the owner of the assets being contributed by the donor and as such, should sign all investment account paperwork.
In addition to the LPL account paperwork, include the advisor firm’s Advisory Agreement for iGiftFund’s signature.
LPL completed form samples:
- Account Application (F1AN or F1BN)
- Beneficial Ownership Form (F528B)
- Entity Information & Certification (F7)
- Move Money – ACH Authorization (CM201)
Organization Legal Name: Use the legal name of the organization (Independent Charitable Gift Fund) on forms F528B and F7 only (DO NOT ADD an FBO).
If you want to identify iGiftFund accounts, consider adding an “FBO ‘DAF name’” in the account registration. Since the Clientworks New Account interface requires the account registration to match the name on forms F528B and F7, please follow the steps below to get around this process:
- Use Clientworks Create a New Account interface.
- Create New Account, but DO NOT send documents for e-signature.
- Open all prepared documents.
- Go to DocuSign – Start – Use a Template.
- Under All Templates, select each form that was created via the Create New Account interface and choose Add Selected. Also add the CM201 to link the iGiftFund bank account.
- Using your pre-created forms as a guide, fill out the manual DocuSign envelope and forms using the account number created by the interface. Use the FBO name in the account registration form but remove it for the F7 and F528B, and send out for signatures.
Note: After creating the first iGiftFund account this way, you can clone/modify a completed iGiftFund DocuSign to reduce manual entry.
Disclaimer: Please note that the instructions a – f above, regarding the creation of forms adding the FBO, is specifically tailored for financial advisors who have access to this interface, and it may not be relevant to everyone. This information has been compiled with input from other LPL financial advisors using this process. For any form-specific questions, we recommend contacting LPL directly, as they are best equipped to assist you.
Data Feed Requirement: iGiftFund does not receive a data feed from LPL. After we receive and sign the investment account paperwork, we will send the financial advisor a Letter of Authorization (LOA) to set up the data feed with LPL through SS&C Advent. The account opening process is not complete until we receive the signed LOA back.
- Fund the DAF – after the investment account is set up and funded, email Donor Support with the contribution date and amount. Use this process for all future contributions. Once the contribution is posted by our Finance Team, the gift acceptance letter for tax purposes will be available in the portal.