A donor advised fund (DAF) is a charitable giving vehicle wherein an individual, family or corporation makes an irrevocable, tax-deductible contribution of personal assets to a charity and at any time thereafter can recommend grant distributions to qualified charitable organizations.
Donor Advised Funds can provide some great advantages, including some tax management advantages.
You can link to the donoradvisedfunds.com website for a comprehensive discussion of DAFs at: http://www.donoradvisedfunds.com/index.html
What is the difference between Donor Advised Funds and Private Foundations?
Starting a private foundation can involve substantial start up costs and administrative expanses, such as the yearly filling of a Form 990-PF. But one of the most important differences is that Donor Advised Funds receive more favorable tax treatment than a private foundation. Donor Advised Funds allow donors to take a federal income tax deduction up to 50% of adjusted gross income (AGI) for cash contributions and up to 30% of adjusted gross income (AGI) for appreciated securities; versus 30% of AGI for cash contributions and 20% of AGI for appreciated securities for a private foundation. Donor Advised Funds also offer the ability to recommend grants anonymously, if desired. It is also possible to convert a foundation over to a donor advised fund to simplify on going maintenance and record keeping.
Wikipedia also has some good information:
http://en.wikipedia.org/wiki/Donor_advised_fund
Fidelity has a charitable gift fund that has low minimums for set up. You can read more here: http://www.charitablegift.org/
