What is a Donor-Advised Fund (DAF)?

A Donor-Advised Fund (DAF) is a philanthropic vehicle that empowers donors to make charitable contributions, receive immediate tax benefits, and recommend grants from the fund to their favorite nonprofits over time.

Endaoment’s unique approach to DAFs leverages smart contracts to ensure transparency and efficiency in grant distribution. This innovative solution transforms traditional charitable giving, offering donors an unparalleled level of control and visibility over their contributions.

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Setting Up a DAF with Endaoment

Creating a donor-advised fund with Endaoment is a straightforward process, and can be accomplished with a crypto wallet, email address or social login. Donors can then fund their DAF with appreciated assets such as stock or cryptocurrency, taking advantage of the tax efficiency of donating directly without the need to convert them to fiat currency. This approach not only simplifies the donation process but also maximizes the impact of each contribution by minimizing transaction costs and potential tax liabilities.

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Recommending Grants from Your DAF: Supporting Your Favorite Charities

Once a DAF is established and funded, donors can recommend grants to qualified 501(c)(3) nonprofits directly through the Endaoment app. Endaoment performs due diligence to ensure that grants reach legitimate and compliant organizations, providing donors with peace of mind. Organizations may receive grants in US Dollars or USDC, a stable cryptocurrency pegged to the US Dollar, offering flexibility and convenience for both donors and recipient organizations.

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Financial Benefits of Using a DAF

One of the primary advantages of using a donor-advised fund is the potential for significant tax benefits. Donors receive an immediate tax deduction at the fair market value of the donated assets, which can include cryptocurrencies, stocks, and other appreciated assets.

By donating these assets directly to a DAF, donors can potentially avoid paying capital gains tax on the sale of the assets, maximizing the impact of their contributions. Endaoment’s onchain structure allows for real-time tracking and auditing of DAFs, providing unprecedented transparency to donors and ensuring compliance with tax regulations.

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Growing Your Philanthropic Impact with DAF Investments

Endaoment.org offers a range of investment options for growing DAF balances, catering to the diverse preferences of donors. These options include traditional assets, such as index funds and mutual funds, as well as cryptocurrency portfolios.

Strategically allocating DAF assets allows donors to potentially increase the impact of their charitable contributions over time. Endaoment has robust safeguards and policies in place to protect platform assets, as outlined in their investment policy.

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Migrating your DAF to Endaoment

For donors who already have a donor-advised fund with another provider, Endaoment offers a seamless migration process, allowing donors to easily transfer their existing DAF to Endaoment. The Endaoment team is available to guide donors through the migration process, ensuring a smooth transition and uninterrupted support for their charitable giving.