Donor Advised Fund established at UD

9:38 a.m., Feb. 15, 2005--Alumni and friends of the University of Delaware now have a simplified way of supporting UD programs as well as other charities of their choice.

The new Donor Advised Fund is a single, professionally managed gift account that is set up to make regular contributions both to the University and to other organizations the donor wishes to support. The fund offers an alternative for donors who want the convenience and immediate tax benefits of making a contribution to a centralized account but also want to be actively involved in how those funds are later distributed.

“The Donor Advised Fund is an attractive option for those who wish to donate to more than one charity, while continuing to support the University,” Robert R. Davis, vice president for University development and alumni relations, said. “It’s a streamlined way of managing your charitable giving without setting up a private foundation.”

To establish such a fund, a donor uses cash and/or appreciated securities or other forms of property, as determined on a case-by-case basis. At the time of the initial gift, the donor may designate specific charities to receive up to 50 percent of the fund upon termination. In addition, the donor may recommend distributions to specific charities or specific UD programs on an ongoing basis the fund. Distributions may be made up to four times a year.

The initial contribution to a fund is expected to be large enough to create a regular stream of distributions of at least $1,000. Half of each distribution must be designated to the University. Once a fund is established, additional contributions may be made to it at any time.

As an alternative to commercial gift funds, donor advised funds that are invested and administered by a specific nonprofit organization are increasingly popular. Such institutions as Harvard, Cornell and Boston universities, Haverford College and the universities of Virginia, Maryland and Colorado have established such funds.

“Donors who give generously to the University often support other charities as well,” Davis said. “A Donor Advised Fund makes that support easier and more efficient, and it allows the donor the flexibility to recommend distributions to specific causes as the need arises.”

A donor who establishes such a fund recommends distributions to particular organizations and programs, which are reviewed by a University committee consisting of the president, the vice president for development or their designees, and other individuals as appropriate. The donor will receive annual statements of the value of the fund, its earnings during the previous year, and all distributions from the fund.

Donors may appoint any one or two individuals 18 years of age or older (including themselves) as Fund Advisers. Donors also have the right to name any or all of their children or one other person to succeed them as advisers of the fund. (All advisers must be at least 18 years of age.)

The funds may be established as “endowed” or “unendowed.” If endowed, the advisers may recommend distributions only out of income from the fund’s investment. If unendowed, the distributions may be made from both income and principal, and the fund will terminate when all its money is distributed.

For more information about the Donor Advised Fund, contact Paula M. Armstrong, director of planned giving in University Development, at (302) 831-2104.

E-mail this article

To learn how to subscribe to UDaily, click here.