Tax Benefits of Donating to a Donor-Advised Fund

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The Tax Benefits of Donating to a Donor-Advised Fund

Many funds will welcome donations of all sorts.

Do I have to donate cash to a donor-advised fund, or can I give stock, too? Which gives the bigger tax benefit? --M.P., Tallahassee, Fla.

See Also: The Most-Overlooked Tax Deductions

You can give cash, stock and a variety of other investments to a donor-advised fund. Donating appreciated assets held for more than a year gives you an extra tax break: You’ll get a charitable deduction for the current value as well as avoid taxes on the capital gains. Plus, with these funds, you can donate stock when it reaches a certain price but wait to choose the charities to support. You can also give assets that are less common. Fidelity’s donor-advised fund, for instance, accepts gifts of real estate, oil and gas interests, and privately held stock, which many charities won’t accept directly.

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