FAQ: How Should I Track Donations From Donor-Advised Funds?

A donor-advised fund is a type of charitable account that individuals use to support charitable organizations that they care about and wish to support. Here's how it works:

1. Donors contribute cash, securities or other assets to the donor-advised fund initiated at a qualified public charity that manages the account.
2. Generally, the donors are then eligible for an immediate tax deduction from that account management organization.
3. The account management organization provides them with tax documentation.
4. Then, those funds can be invested tax-free.
5. The account management organization essentially act as a grantor directed by the funder, who recommends disbursements to virtually any IRS-qualified public charity. The donor advised fund is under no obligation (other than donor relations & reputation) to honor funder recommendations.

Since there can be only one primary Donor on a Salsa CRM Donation record, it is advisable to have the account management organization as the primary Donor "hard credit". You should not record the account management organization as any kind of co-credit or soft credit. The named advisor may be listed as Soft Credit.

Use the Donation Source field to track gifts in Salsa CRM as donor-advised funds.

In another type of donation, the donor-directed fund, donors retain direct control of who receives the donation. Funds are held by a financial institution. The donor finances the fund and has discretion on who receives disbursements. In this case, make the donor the primary Donor "hard credit". You should record the account management organization as co-credit or soft credit.