Donor-Advised Funds (DAFs) - WCI Financial Bootcamp #doctor

Let's talk about Donor advised funds or DAFs. What is a DAF? The moving of the money from your brokerage account to this donor advised fund is permanent, right? You can't take the money back out of the donor advised fund and spend it on whatever you want, but it's also considered a charitable contribution. So if you're taking charitable contribution deductions on your taxes, just putting the money into this vehicle gives you that same deduction whether you actually give it to a charity or not. You basically committed to give it to a charity eventually, so you get the deduction. Now that's a donor advised fund. While it's within the donor advised fund, the money can be invested because it's a charitable thing. You don't pay any taxes, and neither does the DAF or the future charities pay any taxes on the earnings while it's in that account.