How to Give

A tax-smart way to give to UTSA

Donor Advised Funds

The benefits of using a donor advised fund (DAF) are strong and, with the new tax laws, are expected to grow in appeal to strategic donors. They are far easier to establish than a private foundation and allow you to support UTSA with relatively small amounts of money.

How Does It Work?

When you open a donor advised fund, you are creating a separate entity with the sole purpose of using the assets under management to support qualified charities.

You can fund it by irrevocably contributing assets such as cash, appreciated stock, insurance proceeds, or various other forms of capital. Given that your DAF is a separate entity, you can take an immediate tax deduction for the amount of the gift.

As advisor to the fund, you can elect to manage the investments personally or choose to have an investment advisor manage the portfolio.

The two primary avenues of supporting UTSA with your donor advised fund are through a beneficiary designation and recommending grants.

What are the Benefits?

  • Receive an immediate deduction on your taxes.
  • Assets in the fund grow tax free.
  • Easier, and less expensive than establishing a private foundation.
  • Allows you to get started with a relatively small amount of money, as low as a $500 gift.
  • Tax smart for those using a “lumping” strategy under the new tax laws.

With a low barrier to entry and multiple ways to create charitable impact, DAFs are a great strategy for charitable giving. If you have questions about setting one up, or want more information please contact us.

How Can I Set Up a DAF?

If you do not have a donor advised fund and are interested in setting up one, you can do so through the University of Texas Foundation to benefit UTSA and other charities of your choice. The University of Texas Foundation’s Donor Advised Fund provides a flexible option for those who want to support the continuing tradition of excellence in the UT System, as well as other philanthropic interests. The Donor Advised Fund operates much liked a small private foundation on whose governing board the donor sits. This arrangement allows the donors to express ideas on how fund distributions will be used (at least 50 percent must be invested in UTSA or other UT System Institutions).

You may take a full income tax deduction on the initial gift amount as well as any additional gifts, to the extent allowed by law. Once the funds are invested you can recommend grants to UTSA or any other of the 14 UT Institutions. There is a minimum contribution of $25,000 and a required minimum annual distribution of 5% of the assets. contact us to learn more.

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© Planned Giving Marketing. This document is informational and educational in nature. It is not offering professional tax, legal, or accounting advice. For specific advice about the effect of any planning concept on your tax or financial situation or with your estate, please consult a qualified professional advisor.

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