Takeaways
SITUATION: Private foundation grant takes too long for donors who urgently need to get relief funds to a charity after a crisis.
SOLUTION: Use a donor-advised fund to quickly get funds to support relief efforts.
IMPACT: Charity received a $150,000 donation within days instead of months to meet the urgency of the need.
Situation
As second-generation donors driven by a desire to help their community, brother and sister duo Tracy and Alex Moon were accustomed to feeling as though they were making a difference for people in need. So, when they saw a pandemic-driven spike in food insecurity putting a sudden strain on the local food bank’s limited resources, they took action.
They initially thought about giving from their family’s foundation; however, while the foundation had made hunger relief one of its central missions, its process to approve grants annually at an end-of-year meeting didn’t allow for the quick and efficient response needed for a crisis. Tracy and Alex needed another way to respond quickly to the pressing needs they saw around them.
Solution
Tracy and Alex turned to their donor-advised fund (DAF), which allowed them the flexibility they needed to get funds to the charity quickly and give at their convenience without going through the approval process their family foundation required.
Impact
Tracy and Alex got their additional $150,000 donation to the food bank months before their family foundation could have issued a grant. With each $1 from those funds, the food bank was able to provide 10 meals. In total, their donation provided 1.5 million meals to families facing food insecurity within days instead of months.
Disclaimer: This hypothetical example, based on a real scenario with altered identifying information, is for educational use only. The situations, tax rates, and returns mentioned are not reflective of actual clients or investments. There is no guarantee the depicted rates can or will be achieved. Results will vary. Consult legal and tax advisors for suitability. RCF reviewed all due diligence documents, including governing documents, audited financials, and tax returns.
