Donor Advised Funds
GUIDELINES FOR DONOR ADVISED FUNDS
The following policies and guidelines have been established to govern the handling of Donor Advised Funds in a manner consistent with the purposes of the Foundation and in keeping with applicable tax regulations.
A Donor Advised Fund provides donors an unparalleled opportunity to:
- Play an active, personal role in their charitable giving;
- Enhance their understanding of United Methodist-related activities and other charitable needs;
- Benefit from the Foundation’s experience in fund and grant management;
- Obtain immediate tax benefits; and
- Build an enduring, permanent resource that ensures perpetuation of their charitable presence as a part of the Wisconsin United Methodist tradition.
1) Donor Advised Funds belong to the Foundation and are subject to the terms and conditions of its governing instruments.
2) Donors and other advisors named by the donor will meet at least annually to submit recommendations for grants of $500 or more to be made from the Fund. Such recommendations will be given careful consideration. They must be advisory, however, and may not bind the Foundation which by law must have the final authority to determine the use and distribution of all its funds.
3) Suggestions made by donors will be evaluated to determine that they are consistent with the broad purposes of the Foundation and that recommended charities are qualified as nonprofit organizations exempt from federal taxation under § 501(c)(3) of the Internal Revenue Code. Donor recommendations will then be acted upon by a special committee of the Foundation consisting of its Executive Director, President and Treasurer, or such other committee members as may be designated by the Foundation’s board of directors.
In creating a Donor Advised Fund, donors retain the right, during their lifetimes or during the lifetimes of other advisors they name, to recommend grants to specific United Methodist-related activities in addition to charitable distributions to other nonprofit organizations exempt from federal estate taxation under § 501(c)(3) of the Internal Revenue Code.
- In particular, under its Charter the Wisconsin United Methodist Foundation, Inc. has as its principal purpose the support and encouragement of United Methodist-related activities.
- For that reason, the Foundation requires that any Donor Advised Fund established with the Foundation dedicate at least fifty percent of any distributions to Methodist-related activities.
- Within that limitation, donors may consult with the Foundation’s staff concerning other charitable interests and concerns.
- All grant distributions and investment management are handled by the Foundation.
- By establishing Donor Advised Funds, donors have the satisfaction of reflecting their special interests and concerns in the operation of their fund. This pattern will guide the Foundation in managing their fund throughout the years.
4) Subject to appropriate consideration of recommendations made by the donors or other advisors, Donor Advised Fund grants are made primarily to United Methodist-related activities, but can also be made to other nonprofit organizations exempt from federal taxation under § 501(c)(3) of the Internal Revenue Code.
5) From time to time the Foundation will call advisor’s attention to special needs and programs and invite participation in special program initiatives. The Foundation staff is always available to consult with fund advisors and donor briefings will be held regularly to highlight these opportunities.
6) In accordance with Treasury Department regulations, grants awarded from Donor Advised Funds may not be used to pay for memberships, dues or anything that might be perceived as giving material benefit to their donors. In addition, grants may not be used to satisfy previously committed personal pledges made to a charity by a donor.
7) Grants from Donor Advised Funds are made only to nonprofit organizations exempt from federal taxation under § 501(c)(3) of the Internal Revenue Code and may not be made to individuals.
8) Unless the donor wishes to remain anonymous, the Foundation identifies for grant recipients the named funds from which grants are paid, and the grant recipients are encouraged to acknowledge the donor whose generosity made the grant possible.
9) Unless other arrangements are made at the time the fund is established, a Donor Advised Fund will be considered as a permanent endowment.
10) At the time a Donor Advised Fund is established, donors may recommend other living persons (children, friends or business associates) as successor advisors to suggest grants from the Fund. However, advisors selected by the donor may not name others to serve as their successors.
11) The Foundation encourages donors to leave funds as unrestricted as possible upon the termination of the role of the last advisor. At the time the fund is established, however, donors may identify areas of charitable interest consistent with the purposes of the Foundation for future consideration.
12) All funds are subject to the terms and conditions of the Foundation’s governing instruments, as amended. Among other things, the governing instruments provide that the Foundation has the power to modify and vary any donor direction or restriction in the event it becomes unnecessary, incapable of fulfillment or inconsistent with the purposes of the Foundation
