Also serving the communities of De Luz, Rainbow, Camp Pendleton, Pala and Pauma

Charitable Giving Starts at Home

Jean Larsen

Executive Director

Legacy Endowment Community Foundation

Let’s start with a bold statement. Whether you like our current government or not, there has been one positive thing that held true for two centuries: those who are generous in their charitable giving are provided favorable tax deductions and/or offered various solutions to reduce or completely eliminate capital gains.

Of course, it can also be said some layers of complexity have been added in recent decades. But in essence, the greater good of such historical nonpartisanship still favors those who are charitable by offering wonderful tax advantages while helping the community at large.

“Donor-advised funds (DAFs) can enable you to make tax-deductible charitable contributions immediately to receive a current-year tax deduction, but without having to identify nonprofit beneficiaries you want to give to right away or even in that current year. Instead, your gifts are invested so that they may grow with performance-based investing and when you are ready to start making gifts, you recommend grants from your DAF using your name or anonymously if you wish,” said Jon C. Frandell, Legacy Endowment DAF fund holder.

While we may be influenced to give contributions to medical research because of our own experiences, with cancer for example, or a desire to help sick children, disabled veterans or seniors, charity begins at home as a learned value to give back to help others less fortunate.

DAFs help manage decisions about how much we can give and to which organizations, especially when a favorite organization no longer offers a much beloved service or program. Or perhaps they are undergoing leadership changes and you want to see how it all shakes out.

By creating a DAF with a community foundation, donations are invested, built on the principle of protecting and growing the corpus until you are ready to make a decision. Instead of writing lots of checks to multiple individual nonprofits, you can make one or more larger contributions to your named DAF.

Then, whenever you want to give to a nonprofit organization, you contact the community foundation to send a gift from your DAF. The foundation will ensure the organization(s) you’ve recommended are in good standing as an IRS-designated charity and an added plus, you can do all of this anonymously. Organizations are sent the contribution, but your information can be held back, adding a layer of anonymity to avoid pesky calls and mail.

Community foundations have the ability to effectively manage DAFs in ways important for a donor’s comfort and ease of giving. The income from invested assets allows for DAF growth.

It is the donor’s choice as to whether to only give the amount realized from the DAF’s invested growth each year, spend it down over a period of time, or a combination of both. Instead of banking the money for 1-4% in a money market account and paying taxes on the interest earned, contributions into DAFs provide a tax deduction and the investment can steadily grow at 6% per year.

Creating a donor advised fund at a community foundation is a tremendous safety net for its ability to provide one of the strongest, most ethical, long-term depositories for investing in a way that benefits a donor’s charitable interests. Legacy Endowment Community Foundation is a regional resource for Fallbrook, Bonsall, Rainbow and De Luz, helping people create giving plans to benefit beloved charities, pet passions, community projects, and to distribute scholarships to help sustain and improve the quality of life for those living nearby.


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