March 26, 2019
By Jack Doyle, Amergent President/CEO
Last week the Direct Marketing Fundraisers Association (DMFA) hosted a Donor Advised Funds webinar. You can find the recording of the session here. We have secured permission from the DMFA for our clients to access this.
Call me or email me with your questions and comments.
During the session, we presented two scenarios for what donors were considering doing with their appreciated stock, the largest type of donation made into donor advised fund accounts.
$36,000 was invested in 2015 in PayPal; the shares are worth $101,000, a net gain of $65,000.
Option A: donate all the stock to your donor advised fund account to get the large $101k tax deduction and pay the least amount of FED taxes
Option B: donate $60k of the stock to your donor advised fund and sell the balance of stock; you can use $5k to pay capital gains taxes and get $36k back (what you invested initially)
What would you do? Make your decision and then see what 60 webinar attendees would do.
Were you surprised?
Donors with donor advised fund giving accounts are motivated to give for many reasons:
1. The impact of their charitable giving is important
2. You see how some wish to make the most impact they can at any cost
3. Others wish to make the most impact they can within reason
4. Paying less FED taxes is a powerful motivator to some
– A $101k tax deduction for $36k cost is attractive
5. The investor mentality is served by the fact that DAF account balances can grow
You have donors with giving accounts motivated by a wide range of emotions and family values. You are going to have to meet them on their terms. Be open to suggesting they use their giving accounts for different reasons and a wide range of impact outcomes. For some, the $1,000 grant is a starting point, while for others, the $100 amount is how they start. Any and all amounts can become recurring monthly donors if you ask them!
Give us a call and get the conversation going about what we can do together this year.