Blog

Donor-Advised Funds May Be the Best Approach to Giving in 2025 and Beyond

If you’ve noticed more coverage of donor-advised funds in financial publications lately, you’re right on trend. These vehicles have quickly become one of the most popular tools for charitable giving—and for good reason. They allow clients to meet both their financial and philanthropic goals with remarkable flexibility and simplicity.

What many advisors don’t realize, however, is that a donor-advised fund established at a community foundation does much more than simplify giving. It can become the heart of an entire charitable giving strategy, with advantages that go beyond just tax season.

A Centralized, Strategic Approach to Giving

A donor-advised fund, sometimes shortened to DAF, is a way to help clients organize their gifts into one place, including cash and other assets like appreciated stock. The client is able to immediately claim a charitable deduction, and the fund itself has a flexible timeline for when the grants can be distributed.

As we head into 2026, this flexibility is even more important. Changes to the floor and cap on itemized deductions could impact charitable planning, so this is a good time to rethink your strategy. A lot of donors are currently planning to “bunch” several years’ worth of contributions into one DAF, to maximize tax benefits now and still preserve gifts for the future.

Think Beyond the Fund

Establishing a donor-advised fund at the community foundation is often just the beginning. Donors gain access to an experienced team that can guide them toward other giving vehicles that fit their goals.

Designated funds allow clients to support specific organizations for the long term. You can also think about field-of-interest funds, so donors can focus on a particular cause, like education or the environment, but spread the funds across multiple nonprofits.
Another option is an unrestricted fund, which gives the community foundation the ability to respond to any priorities that come up unexpectedly and let a donor’s legacy evolve with the community.

Partnering for Community Impact

Because the community foundation has deep roots in the region, it offers something few national charitable platforms can: local insight. Our team works closely with nonprofits and community leaders to identify where donations can make the greatest impact. This means your clients can give confidently, knowing their generosity aligns with current community priorities and creates tangible results.

We also provide research, grantmaking support, and introductions to organizations doing meaningful work—resources that turn charitable intent into measurable outcomes.

Integrating Tax and Legacy Strategies

A donor-advised fund can also play a valuable role in retirement and estate planning. Clients aged 70½ and older can transfer up to $108,000 per taxpayer (2025 IRS limit) in Qualified Charitable Distributions (QCDs) from IRAs to a designated, field-of-interest, or unrestricted fund at the community foundation. This approach allows them to support charitable causes while bypassing taxable income.

When it comes to long-term planning, we can assist with integrating charitable bequests into wills, trusts, or beneficiary designations. Naming a community fund in those documents helps clients extend their reach past their own lifetime and protects their intent to aid the community in the process.

A Lasting Partnership for Purposeful Giving

Working with the community foundation transforms a donor-advised fund from a simple account into a dynamic philanthropic foundation. It gives clients the structure, insight, and flexibility to manage their giving as their goals—and the world around them—evolve.