Donor Advised Funds (DAF)
A donor-advised fund allows clients to support qualified charities and non-profit organizations, both now and in the future, through a charitable investment account, conferring immediate tax benefits. When opening a donor-advised fund, the donor irrevocably transfers assets (cash, publicly traded securities, restricted stock, or even complex, non-traded private business interests) to the respective donor-advised fund sponsor.
Charitable Remainder Trusts (CRT)
These tax-exempt, split-interest trusts generate a periodic income stream of at least 5% annually for a beneficiary, typically the donor, through irrevocably donated assets. After the predetermined length (at maximum, 20 years) or the donor's death, a charitable organization receives the remaining funds. The two most common types of charitable remainder trusts are:
- Charitable remainder annuity trusts (CRAT), which distribute a fixed amount each year and do not allow additional contributions.
- Charitable remainder unit trusts (CRUT), which distribute a fixed percentage of the trust assets (revalued annually) and do allow additional contributions. These unit trusts may have net income or net income with makeup provisions.