After establishing your donor-advised fund and setting charitable assets aside for philanthropy, it’s time to get to the fun part, grantmaking. Now, you can use the funds from your donor-advised fund to support your favorite nonprofits. As your trusted partner to support your grantmaking, we are here to help. Director of Donor and Corporate Services Brian Motl breaks down some frequently asked questions to help you get comfortable requesting grants from your donor-advised fund.
Q: What is a grant? A: A grant is a donation to a charitable organization. In our world, it’s a distribution from your donor-advised fund. The amount does not matter – it could be $25 or $25 million.
Q: How do I request grants from my donor-advised fund? A: There are two ways to request grants from your donor-advised fund at Greater Horizons. You can submit your request using our online portal, or you can contact Donor Services at support@greaterhorizons.org or 816.842.0944. We recommend using the online portal to ensure we have all the information we need and to expedite the process.
Q: Are there any restrictions on the organizations I can support with grants? A: Greater Horizons does not limit where you can request grants, so you can enjoy supporting any 501(c)(3) public charity in the United States, including governmental, educational and religious institutions. If you are unsure about an organization’s eligibility to receive a donor-advised fund grant, we will do this due diligence for you.
You can also grant to international organizations. Note that they have an additional fee because of the additional due diligence required.
Q: What if I need help deciding where I should give? A: Meet with a philanthropic advisor! Whether one-on-one or through a donor education program, our philanthropic advisors specialize in helping donors align their giving with their interests, values and guiding principles. This self-exploration can help you learn more about the causes you care about most, laying the foundation for your philanthropic vision. You can also use resources like Candid’s Nonprofit Search, Charity Navigator or the Better Business Bureau, which can all help identify charitable organizations.
Q: When I request a grant, I see I need to include a purpose. What does that mean? A: You can communicate to the nonprofit organization how you would like your grant used. Here are a few commonly used purposes:
Q: Can I use my donor-advised fund to pay to go to a nonprofit organization’s event? A: Fundraising events are a fun way to support an organization. There are a few things to know when using your donor-advised fund:
Q: Can I support a membership, like at my local zoo or art museum? A: Yes, but only if the organization confirms that the membership fee is 100% tax deductible. You can also use your fund to cover the membership if your grant request states that you waive the more than incidental benefits related to the membership.
Examples of incidental benefits that you can receive when granting from your donor-advised fund include:
Q: What about supporting students at a college or university? A: You may use your fund to support a scholarship program administered by a 501(c)(3) public charity or educational institution, but you may not earmark dollars to assist a specific individual. If you are an individual, family or business interested in supporting students through scholarships, we invite you to learn more about opening a scholarship fund at Greater Horizons.
Q: Can I support my niece’s mission trip or my neighbor’s triathlon fundraiser? A: Yes. You may use your charitable fund to contribute to a 501(c)(3) public charity or religious institution in honor of an individual as long as the charity exercises complete discretion and control over the donation. When submitting grants in honor of individuals, please state that the donations are “in honor of [individual’s name].” For example, “In honor of John Smith’s Mission Trip” or “In honor of Jane Smith’s 5K Race Team” are appropriate descriptions.
Q: Can I use my charitable fund to support a college or university athletic program? A: Yes. You may use your fund to support a college or university athletic program, but you will need to waive all benefits, including priority seating at athletic events, ticket rights or points, which you should also indicate in your grant request.
Q: Can I make an ongoing contribution (like a pledge) to a charitable cause? A: You may use your fund to fulfill commitments to 501(c)(3) public charities. However, Treasury and the IRS prohibit using the term “pledge” on grant checks or related correspondence. Instead, please reference “donation” or “gift” in your grant request. You can also schedule future grant requests and set up recurring grants to make regular contributions to your favorite nonprofits.
Following these guidelines will help you have the best grantmaking experience possible. As an additional resource, watch our Grantmaking 101 video, where our philanthropic advisors share more about using your donor-advised fund to support charities and how we can help you navigate your grantmaking journey. If you need assistance with anything that was not mentioned here, or if you have any additional questions, contact Donor Services at support@greaterhorizons.org or 866.627.3440.
