Donor Advised Funds FAQ’s

Overview & benefits

What is a Donor‐Advised Fund (DAF)?

A donor‐advised fund (DAF) provides donors with a centralized charitable account. It allows donors to make a charitable contribution, receive an immediate tax deduction, and then recommend grants from the fund over time. A donor advised fund is like a charitable savings account. The donors contribute to their funds as frequently as they like, then recommend grants to their favorite non-profits, schools or faith-based organizations from the fund when they are ready. Like most DAF’s TrustBridge Global can accept cash and equivalents, securities, and other assets.

How does a Donor Advised Fund work?

Donors make an irrevocable, tax‐deductible (depending on circumstances) contribution of cash, long‐term appreciated securities or other assets to a charity, like TrustBridge Global Foundation, that sponsors a DAF program, which then establishes a fund in the donor’s name. DAF donors may choose from a variety of investment options and proceeds are put into an account from which donors may make grant recommendations.

Why do donors choose to have a Donor‐Advised Fund?

Donor Advised Funds offer donors a way to plan, manage and potentially grow their charitable giving. Other benefits include:

• Simplicity – The DAF sponsor organization handles all record‐keeping, disbursements, and tax receipts.

• Flexibility - Timing of your tax deduction can be separate from your charitable decision making.

• Lower cost – Donor-advised funds are often far less expensive than other options such as private charitable foundations or trusts.

• Tax‐efficiency– Contributions are immediately tax‐deductible and any investment growth in the DAF is tax‐free. It is also easy to donate long term appreciated securities, eliminating capital gains taxes and allowing you to support multiple charities from one block of stock.

• Family legacy– A DAF is a powerful way to build or continue a tradition of family philanthropy.

• Privacy if desired– Donors may choose to remain anonymous to the grant recipient.

How are sponsoring DAF organizations structured?

In the United States, the sponsoring organizations of donor‐advised funds are organized as 501(c)(3) public charities. TrustBridge Global in the United States is recognized as a sponsoring organization of DAF’s and a public charity. In Switzerland, TrustBridge Global is structured as a charitable organization both at the cantonal level and the federal level.


HOW DAFs WORK

How are grant recommendations reviewed and paid?

As a charity that sponsors a DAF program, TrustBridge Global reviews grant recommendations to ensure that the recommendation is in accordance to donor‐advised fund guidelines, local charity rules, and the overall purpose of the sponsoring organization. Once approved, the funds are paid via check posted to the mail, or transferred electronically depending on the DAF, the needs of the charity or at the request of a donor.

Who can open a donor-advised fund account?

Individuals, families, companies, foundations, and other entities can open a donor-advised fund at TrustBridge by filling out a short application and contributing assets.

How much do I need to open a donor-advised fund account with TrustBridge?

There is no minimum to open a donor-advised fund, however, there are monthly minimum fees associated with having one.

Should non-profits send tax receipts when receiving a DAF grant from TrustBridge?

There is no need for you to send tax receipts as the DAF donor at TrustBridge already received a tax receipt.

What is the cost of having a DAF with TrustBridge?

  • 1st CHF 5 million: 30 bps : 0.0030% (30 basis points “bps”) annual rate, assessed monthly

  • 2nd CHF 5 million: 25 bps

  • 3rd CHF 5 million: 20 bps

  • Thereafter: 15 bps

All are subject to a minimum of CHF 500 per month. Exceptions to the minimum can be made.

How long does the approval process take prior to the money being sent?

For grants that are staying in the donor’s home country, the approval process generally takes less than a week and grant recommendations are decided upon as soon as possible. For international grants, there is a larger due diligence process that needs to be undertaken before grants can be sent across borders. Please see questions related to the international grant making process below.


GRANT MAKING FAQs

Can I recommend a grant from my TrustBridge donor-advised fund account to any charity or non-profit organization?

In the US, TrustBridge can make grants to charitable organizations that are tax-exempt under Internal Revenue Code (IRC) Section 501(c)(3) and public charities under IRS Section 509(a). TrustBridge can also make grants to private operating foundations. TrustBridge cannot make grants to private non-operating foundations or directly to individuals.

For grants going outside of the US, we look at each grant recommendation and charitable organization on a case by case basis and use a due diligence process that looks at a number of factors to qualify an organization to receive grants.

The grantee needs to be recognized as a tax-exempt, charitable entity in the country of their registration in order to qualify. There are other, country specific qualifications that may also need to be met. If you have a special grant request, please contact TrustBridge directly.

Can I recommend grants from my donor-advised fund account to international organizations?

TrustBridge is based in Switzerland with an affiliate office in the United States and is one of the donor-advised fund providers that makes international and non-501(c)(3) grants. These grants require additional due diligence to determine if the charity is eligible to receive international funds. International grants also require additional monitoring.

As a result, TrustBridge charges fees for these types of grants. The set-up fees are charged when you recommend the charity for vetting and then, once the charity is approved, there is a charge against the grant amount that you would like to send to the charity.

I see on the website that TrustBridge Global is part of a global network of DAF foundations. Who are the partners that currently work with TrustBridge?

In each country where there is an affiliate DAF provider, we recommend that donors use these organizations as their in-country experts for donor-advised fund services and local giving. These organizations are extremely knowledgeable about their respective local landscapes and provide valuable guidance to donors on effective and meaningful giving in these locations. Currently the preferred providers in the TrustBridge Global Network are:

We are continuing to add new affiliates to expand the network and enable greater ability to help fund global, charitable work.

Can I use a non-TrustBridge US based DAF to send money to an international organization?

Yes, because TrustBridge Global Foundation USA is a registered charity, grants from US based DAF charities, like NCF, can be sent to TrustBridge USA and used to recommend grants to international charities. The approval of an international charity is not automatic and requires additional due diligence. Contact TrustBridge directly for further information.

What if I use a DAF outside of the US?

Because TrustBridge utilizes a network of similar DAF foundations around the globe, there is the ability to use DAF funds from several of our partners outside of the US to make international grants.

How many grants can I recommend in a year?

There is no limit to the number of grants you can recommend in a year.

What is the minimum grant amount that I can recommend be sent to a charity?

  • For a Swiss grant, the minimum is 250 CHF.

  • For a US grant, the minimum is 250 USD.

Are there fees charged for the grants that I recommend?

The fee on grants depends on where the funds originate and where they are going. For grants given to US charities from US DAF holders, TrustBridge does not charge a per-grant fee. For grants to Swiss charities from donors with a Switzerland based DAF with TrustBridge, there is no per grant fee.

International grant making is more complex, and TrustBridge does charge fees related to these types of grants. There is an initial, non-refundable, 150 USD /150 CHF fee to work with the international charity on completing the due diligence process necessary for approval.

We also charge 1% on any international grant that we make, subject to a minimum of 300 USD/300 CHF, plus a 25 USD wire fee. The wire fee is waived for grants going to either US or Swiss charities.

The set-up fees are charged when you recommend the charity for vetting and then, once the charity is approved, there is a charge against the grant amount that you would like to send to the charity. Because of the complexity and regulatory burden of making international grants, we are designed for larger grants and are not set-up to do smaller recurring grants. The entire fee schedule that includes costs to/from other network countries is available upon request. Costs generally do not exceed 3% of the total grant amount.

How long does it take to approve an international charity?

The time frame is wholly dependent on the responsiveness of the international charity and their ability to provide the supporting documents necessary for an approval. Once the due diligence package has been completed and submitted to TrustBridge, our team can finalize an approval within a week.

What does the due diligence on an international charity entail?

Our main source of charity referrals is the donor. When a donor would like to support an international charity, we ask that they make an introduction via email. We can then work closely with that charity to walk through the approval process. TrustBridge Global (TGF) uses a process that is similar to the US ED process to ensure compliance across multiple jurisdictions. TGF staff requests that the charity fill out an application/affidavit that also prompts that organization to provide documentation necessary to determine whether the organization would be considered charitable under Swiss rules and that the organization would likely be considered the equivalent of a U.S. 501(c)(3) public charity. Legal charity requirements, governing documents, organizational purpose, and financial information is reviewed for compliance with charity law. Additionally, leadership and board members are checked against sanctions lists in an effort to reduce the AML/ATF risk.

If there is an affiliate in a country where a grant is being recommended, TrustBridge will utilize the network member to complete the due diligence process. This ensures that there is a local foundation confirming that the charity is legally eligible to receive charitable funds in that country. For example, if a US donor is recommending a grant to a charity in South Africa, TrustBridge will ask Tree of Life Foundation to finalize the due diligence process. There are no additional fees for this oversight.

Are there ongoing benefits to the charity to working with TrustBridge?

Once a charity is approved by TrustBridge, they are given a Charity Fund number. This Charity Fund can then be used to take in contributions from donors in several countries where TrustBridge operates and allows those donors to receive tax deductions for their contributions. The Charity Fund can be also used to “pool” contributions from donors to maximize grant fees, which can then be sent on to the charity to fund their work. This tool allows charities to take in donations from countries where they may not have been able to cultivate donors in the past.