The Kentucky Baptist Foundation (KBF) has served the churches, institutions and agencies of the Kentucky Baptist Convention (KBC) since 1945. Throughout the 77 years, KBF has been promoting wise stewardship and assisting individual church members with estate planning and generous giving ideas.
Recently, I received a call at my KBF office from an individual describing a financial blessing he and his family had received. Without sharing details, it would be easy for me to describe the gift as a “life changing financial event.”
Being a devoted follower of Jesus Christ and a church member, he asked for suggestions on sharing his new-found wealth. I recommended a KBF Donor Advised Fund (DAF) — a smart and intentional way to “Fund the Great Commission.”
I am aware that many KBC church members inherit farms, estates and stock windfalls that are truly life changing. A savvy financial investor, mentor and example of a generous giver may want to consider a KBF Donor Advised Fund for tax advantages. The Donor Advised Fund may increase in value, which is another major advantage. Investment earnings can multiply the impact of the original gift.
Here are several suggestions from KBF’s General Counsel Austin Wilkerson. I believe these explanations are very insightful.
- Tax benefits: When you contribute to a Donor Advised Fund, you may receive an immediate tax deduction for your donation, even if you don’t distribute the funds right away. Additionally, any investment earnings on the contributed assets are also tax-free.
- Simplified giving: A Donor Advised Fund makes charitable giving simple and efficient. You can make a contribution to the fund and then recommend grants to any qualified charity at any time, without the need to handle cumbersome paperwork, due diligence or tax reporting. It’s a streamlined way to support your favorite ministries.
- Long-term planning: A Donor Advised Fund allows you to make a larger donation and receive an immediate tax deduction while taking your time to decide which charities to support. You can grow your charitable funds tax-free and strategically allocate grants over time, according to your priorities and giving goals.
- Legacy planning: You can name your Donor Advised Fund as a beneficiary in your estate plan, which can ensure that your charitable legacy lives on. You can also involve your family in the grant-making process, making it a multi-generational tool for giving.
- Flexibility: A Donor Advised Fund can accept a wide range of assets, including cash, securities and other assets such as real estate. This flexibility allows you to make a contribution in a way that maximizes your tax benefits while supporting your charitable goals.
Kim Fulkerson, KBF’s chief operating officer, describes the impact of Donor Advised Funds.
“It is exciting to process distributions from our donor advised funds and know the impact these gifts will have on ministries across the state. From Vacation Bible School to Fellowship of Christian Athletes, students are hearing the gospel because of the funds provided by our generous donors. Important ministries like Sunrise Children’s Services have received much-needed funds to provide services to vulnerable children and teens. Churches have been blessed with additional funds to provide training and support for pastors.”
In addition, Wilkerson also believes that using the KBF Donor Advised Fund is simply a great decision for those with recently acquired resources.
“In the wake of a financial windfall, a KBF Donor Advised Fund is an extraordinary instrument,” Wilkerson said. “It’s an opportunity to harness an unexpected blessing, transforming it into an engine for good. It’s an answer to the question of ‘where do these funds go?’ before the question arises. This way, it becomes the seed for far-reaching generosity, advancing God’s work, not just for a moment, but potentially for years.”
I speak often with churches, individuals and institutions about good news from faithful Kentucky Baptists who have made significant gifts through their Donor Advised Funds. These funds have served as a lifeline to churches and ministries across the commonwealth. Just like my conversation with my friend over the phone, he was well pleased in hearing of the KBF Donor Advised Fund. He is now seeking God’s guidance as he prepares to share his financial blessing with his church and other ministries.
If you have questions about KBF Donor Advised Funds or other advanced giving options, please call me at 502-489-3533, or visit our website to schedule a free consultation: kentuckybaptistfoundation.org/free-consult.
French Harmon is president of the Kentucky Baptist Foundation.
The information in this article is provided as general information and is not intended as legal or tax advice. For advice and assistance in specific cases, you should seek the advice of an attorney or other professional adviser.
This article was reposted from Kentucky Today.