Donor-Advised Fund - DAF Policy

DONOR-ADVISED FUND (DAF) POLICY

1. Definition

This Donor-Advised Fund (DAF) is a separately identified fund or account that is maintained and administered by LIFE CHARITABLE FOUNDATION INC., EIN: 88-2316500, a 501(c)(3) nonprofit organization (the “Sponsoring Organization”). Contributions to the DAF are irrevocable and must be used for charitable purposes in accordance with applicable laws and regulations.

2. Contributions (Deposit) & Tax Deductibility

Donors may contribute (deposit) cash, securities, real estate, cryptocurrency, or other approved assets.
Contributions (Deposit) are tax-deductible in the year they are made, subject to IRS rules.
Once the donor makes the contribution, the organization LIFE CHARITABLE FOUNDATION INC. has legal control of over it.
However, the donor, or the donor's representative, retains advisory privileges with respect to the distribution of funds and the investment of assets in the account.
The Internal Revenue Code applies substantiation requirements for donors, and disclosure requirements for charitable organizations, in connection with charitable contributions.
2. (a) Substantiation of contributions

A donor can deduct a charitable contribution of $250 or more only if the donor has a written acknowledgment from the charitable organization.
2. (b) Charitable contributions: Written acknowledgments

The written acknowledgment required to substantiate a charitable contribution of $250 or more must contain the following information:

- name of the organization;

- amount of cash contribution;

- description (but not value) of non-cash contribution;

- statement that no goods or services were provided by the organization, if that is the case;

- description and good faith estimate of the value of goods or services, if any, that organization provided in return for the contribution; and

- statement that goods or services, if any, that the organization provided in return for the contribution consisted entirely of intangible religious benefits, if that was the case.

In addition, a donor may claim a deduction for contributions of cash, check, or other monetary gifts only if the donor maintains certain written records.

The donor must get the acknowledgement by the earlier of:

The date the donor files the original return for the year the contribution is made, or

The due date, including extensions, for filing the return.

The donor is responsible for requesting and obtaining the written acknowledgement from the donee.

A donor cannot claim a deduction for any contribution of cash, a check or other monetary gift made on or after January 1, 2007, unless the donor maintains a written record of the contribution.

Cash Donations

A donor may not claim a deduction for any contribution of cash, a check, or other monetary gift made on or after Jan. 1, 2007, unless the donor maintains a record of the contribution in the form of either a bank record (such as a cancelled check) or a written communication from the charity (such as a receipt or a letter) showing the name of the charity, the date of the contribution, and the amount of the contribution.

The donor must get the acknowledgement by the earlier of:
The date the donor files the original return for the year the contribution is made, or
The due date, including extensions, for filing the return.
The donor is responsible for requesting and obtaining the written acknowledgement from the donee.
A donor cannot claim a deduction for any contribution of cash, a check or other monetary gift made on or after January 1, 2007, unless the donor maintains a written record of the contribution.

3. Investment & Fund Management

The foundation may invest DAF contributions, and any investment growth is tax-free.
Donors may recommend investment allocations, but final decisions rest with the Sponsoring Organization.
Investment performance is not guaranteed, and funds may fluctuate in value.

4. Grant (Withdrawals) Recommendations

Donors may recommend grants (withdrawals) to eligible 501(c)(3) public charities and other persons.
The Sponsoring Organization reviews and approves grants (withdrawals) to ensure compliance with IRS regulations.
Grants (withdrawals) cannot be used for private benefits, political contributions, or non-charitable activities.
No grants (withdrawals) may satisfy legally binding pledges, provide personal benefits to donors.
All grants (withdrawals) are awarded on an objective and nondiscriminatory basis pursuant to a procedure approved in advance by the sponsoring organization’s board of directors.
Thus, a sponsoring organization that owns and controls a fund that meets these criteria may award a scholarship from the fund to a natural person without subjecting the sponsoring organization or its managers to excise taxes under new section 4966.

4.(a) Taxable Distribution

New section 4966 imposes an excise tax on a sponsoring organization for each taxable distribution it makes from a donor advised fund. It also imposes an excise tax on the agreement of any fund manager of the sponsoring organization to the making of a distribution, knowing that it is a taxable distribution. The tax on taxable distributions applies to distributions occurring in taxable years beginning after August 17, 2006.

In general, under new section 4966(c), a taxable distribution is any distribution from a donor advised fund to any natural person, or to any other person if (i) the distribution is for any purpose other than one specified in section 170(c)(2)(B), or (ii) the sponsoring organization maintaining the donor advised fund does not exercise expenditure responsibility with respect to such distribution in accordance with section 4945(h).

Under new section 4966(c)(2), a taxable distribution does not include a distribution from a donor advised fund to: (1) any organization described in section 170(b)(1)(A) (other than a disqualified supporting organization), (2) the sponsoring organization of such donor advised fund, or (3) any other donor advised fund.

Under new section 4966(d)(4), a disqualified supporting organization includes a Type III supporting organization that is not functionally integrated and any Type I, Type II, or functionally integrated Type III supporting organization where the donor or donor advisor (and any related parties) directly or indirectly controls a supported organization of the supporting organization.

5. Fees & Administrative Costs

The DAF is subject to administrative and investment fees, which help sustain operational efficiency.
A detailed fee schedule is available upon request.

6. Privacy & Confidentiality

Donors may choose to make grants anonymously or with public recognition.
The foundation follows strict data protection policies to safeguard donor information.

7. Inactive & Legacy Funds

If a fund remains inactive for an extended period (e.g., 5 years without grant recommendations), the foundation may direct funds to charitable purposes aligned with its mission.
Donors may designate successors to continue making grant recommendations.

8. Amendments & Compliance

LIFE CHARITABLE FOUNDATION INC. reserves the right to update this policy to remain compliant with IRS guidelines and nonprofit best practices.

9. Contact Information

For further inquiries, please contact:

📍 LIFE CHARITABLE FOUNDATION INC. Tax Exempt Organization Search IRS https://apps.irs.gov/app/eos/
📞 (929) 800-4040
📧 i@donoradvisedfund.us
🌐 donoradvisedfund.us