The Donor Advised Funds (DAF) program at the Jewish Federation of Metropolitan Chicago continued to grow and thrive in 2013, helping thousands of donors to make meaningful contributions to both the Jewish and secular communities.
In 2013, community members opened 35 new Donor Advised Funds and distributed 5,809 charitable grants totaling $28.6 million to a wide variety of charities in Chicago, the U.S. and Israel, and around the world.
A Donor Advised Fund (DAF) is a vehicle for charitable giving that allows donors to better manage and organize their charitable giving through a single, personalized fund, while also enjoying a tax deduction each time money is deposited into the fund. As a less costly alternative to a private foundation, Donor Advised Funds are held at and managed by the Jewish Federation, financial institutions and community foundations. The Jewish Federation currently administers 818 DAFs with aggregate assets of $141.7 million-up 43 percent from last year.
"We are proud that so many members of the Jewish community have entrusted the Jewish Federation with their charitable dollars," said Peter Kupferberg, Chair of Jewish Federation's Philanthropic Fund Committee. "The growth of the program is a reflection of our community's exceptional generosity, as well as the Federation's ability to provide expert services to our donors."
The Jewish Federation's Donor Advised Fund Program began in 1971 and is among the oldest and most established programs of its kind in the country-and continues to seek innovative ways to improve year after year. Last summer, the organization implemented a new investment policy that under certain circumstances, allows outside financial advisers to continue to manage their clients' assets even after those assets have been contributed to a DAF. 2013 also was the inaugural year of a strategic partnership with Israel Bonds which, according to Associate Vice President of Donor Advised Programs Rose Jagust, allowed donors to "get twice the bang for their philanthropic buck by investing a portion of their DAF assets in Israel bonds which, when redeemed, return to the Jewish Federation to be put to work all over again."
In 2013, 74 percent of the Jewish Federation's DAF charitable distributions went to Jewish organizations, and 26 percent were directed to secular causes.
The Jewish United Fund was the largest beneficiary of 2013 DAF distributions, receiving $5.4 million from 553 individual grants. Other Jewish organizations receiving significant funds included: The Jewish Federation of Metropolitan Chicago, The Jerusalem Foundation, American Friends of the Hebrew University, Friends of the IDF, American Friends of the Israel Museum, and Spertus Institute of Jewish Learning and Leadership.
Donors also made significant contributions to universities, cultural institutions, and health organizations, especially those based in the Chicago area. Top college recipients included the University of Chicago and Northwestern University, and major contributions were also made to the Harris Theater for Music and Dance, the Lyric Opera of Chicago, and the Art Institute of Chicago. In the health sector, significant distributions were made to Northwestern Memorial Foundation and the Usher III Initiative (seeking a cure for blindness). Additional recipients ran the gamut from the Inner-City Scholarship Fund to the Newberry Library to the Boys and Girls Club of Chicago.
Starting a Donor Advised Fund requires a minimum tax-deductible contribution of just $1,000. Then the donor recommends where Jewish Federation should invest those dollars, which can grow tax-free. The donor then will recommend how those funds should be distributed as grants to non-profits in good standing throughout the U.S. and the world.
Donors can name their fund in honor of their family, in memory of a loved one or to celebrate a special occasion, such as a bar/bat mitzvah, graduation, or wedding.
Federation offers secure online access to DAF contributors, who can make their gift recommendations online, check their balances, and track their account activity throughout the year. Donors may add funds to their DAFs as they wish, and can make additions in the form of cash, stock or other appreciated assets. Federation staff does due diligence to confirm the soundness of charities receiving grants, handles all the paperwork, and ensures that grants go out twice a month.
For more information, please contact Nicole Miller at (312) 357-4719 or NicoleMiller@juf.org.