This story appeared in the fall 2023 issue of the Corridor newsletter. For the most up-to-date information about the benefits of a donor-advised fund (see list below), please visit our donor-advised fund webpage or contact the MIT Office of Gift Planning and/or your financial advisor. 

In recent years, philanthropy has witnessed a surge in donor-advised funds (DAFs), and it’s easy to see why. DAFs offer many of the same benefits of creating a private foundation while avoiding the associated legal, tax, and regulatory burdens. They are relatively easy to establish, and donors can make grants directly from their DAF to a qualified nonprofit institution like MIT at any time. During the past fiscal year, approximately 3,000 grantmakers have used their DAFs to give to MIT. Thank you!  

The financial commitment to open a commercial or community foundation DAF is not as high as one may think—generally $5,000 to $10,000. MIT sponsors its own DAF, which is invested in the MIT endowment, for those who are able to commit a minimum gift of at least $1 million and allocate a minimum of 50% to MIT.

If you are interested in giving to MIT through a DAF and have questions about how to make grants to areas that align with your charitable interests, we invite you to connect with us so we can put you in touch with the best resource. If you have already been giving to MIT through a DAF, we thank you for including MIT in your grantmaking decisions! 

Finally, if you have a DAF and have named MIT as a beneficiary on the account—or are interested in doing so—please notify our office so that we may assist you and welcome you to the Katharine Dexter McCormick Society.

Grants made from DAFs to MIT provide vital support for cutting-edge research, scholarships, and advancements that drive positive change on our campus and throughout the world. Thank you for being part of that change.

The Benefits of a DAF

• IMMEDIATE TAX DEDUCTION
  You are eligible for an immediate tax deduction in the year of the donation to the DAF account.
   
• ASSET FLEXIBILITY
  Cash, stocks, or other appreciated assets can be contributed directly to a DAF, which can lead to additional tax benefits.
   
• STRATEGIC TAX PLANNING
  Donors can make contributions during years of higher tax liability or years in which they intend to itemize their tax return, then initiate grants to MIT and other charities when the timing is right.
   
• NAME BENEFICIARIES
  Name MIT and/or other charities as the beneficiary(ies) of your DAF once you or other members of your family cease advising the fund to ensure that any remaining amount makes it to your desired destination(s).

As always, the MIT Office of Gift Planning is available to answer your questions. Contact us today to start the conversation. 

This information is up-to-date as of August 2023. DAFs are often a topic of discussion at the federal level, and there have been active discussions about changing the legislation around them for a number of years. Information in the Corridor newsletter should not be considered legal or financial advice. We encourage you to discuss these options with your advisor.