In short
A donor-advised fund is an account held by a sponsoring public charity. The donor gets an immediate charitable deduction when contributing and can recommend grants to charities later.
Key takeaways
- Contributions are irrevocable, and the sponsoring charity has legal control.
- Donating appreciated stock to one avoids capital gains tax and is deductible at fair value.
- Qualified charitable distributions from individual retirement accounts can't go to one.
Where it's tested
TCP: Individual Tax Planning Strategies — study notes, a five-minute revision sheet and practice questions.
Practise: 3 questions
Question 1 of 3 · 0 answered
A taxpayer sells stock at a $10,000 loss on December 10 and repurchases the same stock on December 28 of the same year. What is the tax result?