Deduct now, donate later – Donor-advised funds offer significant benefits

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Abstract: Taxpayers who are planning on making significant charitable donations should consider a donor-advised fund (DAF). These funds offer many of the tax and estate planning benefits of private foundations, but at just a fraction of the cost. This article explains how a DAF works and its benefits, such as the ability to deduct DAF contributions immediately but make gifts to charities later. A sidebar discusses how private foundations can offer important advantages for those who can afford them.