Just as each of your clients has a unique estate plan and financial plan to meet the client’s particular situation and goals, each of your philanthropic clients needs a unique charitable giving plan. For example, for some clients, giving shares of highly appreciated stock consistently every year to their fund at The Foundation for Enhancing Communities (TFEC) makes the most sense for their charitable goals and their mix of assets. For other clients, leaving a bequest to TFEC to support specific areas of interest is the best fit for the client’s financial situation and community priorities.
TFEC offers charitable giving vehicles to meet a wide range of clients’ needs. In many cases, a single client can benefit from setting up multiple funds of different types.
Here’s a quick primer on a few of the most popular fund types.
Donor Advised Fund
A donor advised fund enables your client to establish a personal charitable fund to meet their goals. Your client makes tax-deductible contributions of cash, stock or other highly appreciated assets to the fund and recommends grants to their favorite charities.
Unrestricted Fund
TFEC has its finger on the pulse on central Pennsylvania’s most pressing issues. An unrestricted fund gives your client the opportunity to support community needs that are relevant now as well as those that can’t be identified until the future. One of the biggest benefits of a community foundation is its perpetual structure that allows clients and their families to offer support to nonprofits, with persistent management that evolves the support over time as priorities in the region shift.
Area of Interest Fund
Clients who want to target their giving to specific areas of community need (such as education, health, environment or the arts) can set up an Area of Interest fund to establish parameters for grantmaking under the ongoing guidance and expertise of TFEC’s team and volunteer committees.
Restricted Fund
A restricted fund allows a client to direct giving to a specific agency(ies) or purpose(s). Over time, TFEC’s team manages the grants from the fund according to the terms established by your client.
Scholarship Fund
Clients can set up funds to support students’ educational pursuits, based on the parameters and application requirements they outline, with help from TFEC’s expert scholarship team.
Agency Fund
An agency fund is established by a nonprofit organization, and the nonprofit organization itself is the beneficiary. If your client serves on boards of directors of charities, they’d likely be interested in learning more about agency funds. Indeed, if you represent nonprofit organizations and their board members in your practice, it’s helpful to remember that organizations frequently establish agency funds at TFEC to set aside endowment reserves or rainy-day funds. The team at TFEC is adept at navigating the specific accounting standards unique to this type of arrangement.
Here’s a pro tip: If you represent clients aged 70 ½ and older, consider recommending a qualified charitable distribution from a client’s IRA to a fund at TFEC. All the fund types noted above are eligible recipients, apart from the Donor Advised fund.
Learn more about TFEC’s funds by visiting our List of Funds page, contacting us by phone at 717.236.5040 or emailing info@tfec.org.
We look forward to working together to discover the type of fund (or funds!) at TFEC that could be a good fit for each client’s unique charitable giving.
