DAF vs Charitable Trust
DAF: immediate full deduction, distribute over time. CRT: income for life + remainder to charity. DAF for simplicity; CRT for income.
| Asset value | — |
| Tax bracket | — |
| Years | — |
| DAF tax saving | — |
| DAF FV | — |
| CRT deduction | — |
| CRT tax saving | — |
| CRT total income | — |
Donor Advised Funds (DAF) and Charitable Remainder Trusts (CRT) both provide charitable tax benefits but with different mechanics. DAF: immediate full deduction + simple recommendations. CRT: deduction for present value of remainder + life income stream for donor.
DAF Mechanics
Donate appreciated assets to DAF (Fidelity Charitable, Schwab, Vanguard). Get full immediate deduction (subject to AGI limits 30-60%). Money grows tax-free. Recommend grants to charity over time. Cost: 0.6-1% AUM. Best for: simple charitable giving + investment management.
CRT Mechanics
Donate to trust; trust pays donor (or spouse) income 5-50% of trust value annually for life or fixed term (max 20 yrs). Remainder goes to designated charity at end. Donor gets deduction for present value of remainder. Best for: appreciated assets + need income stream + future charitable intent.
Tax Comparison
DAF: deduction up to 60% AGI (cash) / 30% (appreciated property). CRT: deduction = PV of remainder (typically 30-50% of contribution). Both avoid capital gains on appreciated property. DAF more flexible; CRT better for income generation.
Last updated May 2026. Sources: Fidelity Charitable.