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Donor-advised fund account vs. private foundation

A Schwab Charitable™ donor-advised fund account is a flexible and tax-efficient way to give, whether you use it as your main charitable vehicle or as a complement to a private foundation or charitable trust.

Private Foundation Donor-Advised Fund
Asset minimums Generally recommended only for those with millions of dollars in charitable assets $5,000
Startup costs May be substantial—legal documentation, tax filings, etc. None
Ongoing annual expenses May be substantial Comparatively low
Privacy Public disclosure of contributions and grants in annual tax filings Individual account activity can be private
Tax deduction limits for cash contributions 30% of adjusted gross income (AGI) 50% of AGI
Tax deduction limits for securities contributions 20% of AGI 30% of AGI
Tax deduction limits for real estate and other assets 20% of AGI, deductible at cost basis 30% of AGI, deductible at fair market value
Administration Required recordkeeping, asset management, review of grant solicitations, tax filings Managed by Schwab Charitable
Reporting Required annual state and federal tax returns None at the account level
Taxes Excise taxes, up to 2% of annual investment income None
Annual distribution requirements 5% distribution required annually At donor’s discretion
Professional asset management options Yes Yes

Learn more about Private Foundation Conversion >