I don’t believe this is necessary. Once money is given to a DAF, it’s a charitable donation in that particular tax year and is no longer owned or considered net worth of the individual. They only “play” it should receive in PL is simply as a charitable contribution in that tax year. This capability already exists in PL. It would be problematic to have a separate account for DAF b/c those assets no longer belong to the person.

I have no comment on Donor Advised Funds being an account type but they should get their own Expense type. Donations into the DAFy from an investment account can be cash but are often appreciated securities. Donations are both tax deductible and non-taxable in terms of capital gain taxes. Charity Expense doesn’t have the non-taxable option.

Perhaps just allowing Donation expenses which funded from a Taxable Investment account to be marked as tax-efficient/exempt from LTCG would suffice.

I would really like this feature, I just learned about DAFs and I’m starting to shift my contributions away from cash to stocks. I would like to model this in PL. I like Greg’s idea above, it’s how I envisioned it to work.

I’d like this as well. I’m about to make a good-sized DAF contribution from a post-tax account, and I’d like to track charitable donations to that DAF over time as well. If we can see what donations do to our plans and taxable income in PL, it helps us plan for philanthropic giving.

A daf is not your money! One you put money in, it is essentially gone from your estate. This enhancement is not worth spending time on.

Lloyd, there’s no debate that funds in a DAF are no longer your money.

The request is to correctly model the tax-advantaged means of contributing appreciated assets to a DAF in ProjectionLab. Currently, donations of assets (e.g. stock) are assumed to be sold, taxable profit realized, and the cash donated, which isn’t how it works IRL.

Are you saying that when you create a charitable expense and have it comes out of your after tax investment account the software does 2 things: 1) correctly records charitable expense and includes them in itemized deductions, and 2) incorrectly records a gain on sale (presuming you have input a cost basis less than FMV for your after-tax investment account)? If that is the case then clearly that is wrong and would be nice to record it correctly.

It’s kind of funny because i just did one yesterday - transferred a stock with low cost basis to a DAF!

Lloyd, if you the Daffy transfer as a charitable expense then it’s being counted as taxable transaction when it’s actually non taxable. This is why we’re saying DAF transfers need to be a specific thing with correct tax treatment.

OK now I understand what you are saying PL does. Cleary it’s not right!!

This is really valuable for anyone with charitable giving goals. I donate a percentage of my wealth to charity every year and would like to continue this till I die. But of course I want to do this in a tax-efficient manner! My approach is to gift appreciated stocks to a DAF and then direct that DAF to donate to my selected charities throughout the year. Sometimes I also use a bunching strategy for these transfers, moving two or three years worth of charity to the DAF all at once for maximum tax benefit, but still distributing it to recipients over time. I need the ability to track transfers from my brokerage to a DAF without incurring tax on the appreciated assets. I also need to project DAF balances and charitable donations from it to make sure I continue to meet my own giving targets. Icong on the call? Being able to plan ahead to optimize how much to move into the DAF to support future donations.

In version 4.5, we have added the ability to make charitable deductions that emulate donating appreciated shares. This may close the gap for many folks following this thread. This is in early access now and will be in production within the next few weeks.

While we haven’t introduced a new account type to hold the donations, since those funds are effectively outside of your plan, we think this may be sufficient for a lot of people. i.e. modeling the tax impact of donating appreciated shares.

We encourage folks interested in this to try the new donation option DAF.
Charitable Donation expense -> Donation Type -> Donor Advised Fund. If you have other related feature ideas that aren’t yet covered, please file a new request. Thank you!