Client tax statements
Resources to share with your clients about DAF tax statements.
Last updated
Resources to share with your clients about DAF tax statements.
Last updated
Once your client has accepted their invitation to their account under your firm's custom giving program, they will receive automated annual tax statements in their account.
As an advisor, you can retrieve annual tax statements on behalf of your clients.
It may be helpful to have awareness of how giving account tax statements work so you can best support your client as they seek to understand their tax information:
Charityvest does not provide tax advice. While we seek to be as helpful as possible, accurately establishing and reporting charitable contributions to IRS is the taxpayer's responsibility.
For clients, a donor-advised fund is highly beneficial from a tax and financial planning perspective, as it offers:
Unified tax receipt: a single tax receipt each January summarizing your client's prior year's giving. If your client donates stock or cryptocurrency, we also provide them with a pre-filled IRS Form 8283 to substantiate those gifts.
Immediate income tax deduction: contributions are immediately tax-deductible.
No capital gains taxes on asset gifts: when your client gifts long-term appreciated assets such as stock and cryptocurrency to their giving account, they receive an acknowledgment of the full fair market value of their gift. And because Charityvest, Inc. is tax-exempt, we incur no capital gains tax on the sale of the asset, retaining the full value for charitable purposes.
Tax-free appreciation: if you invest your client's giving account balance, all market growth and dividends occur tax-free inside of their giving account.
No estate taxes: since your client's giving account is owned and maintained by Charityvest, Inc., it is not considered a part of their estate and is therefore not subject to estate taxes.
To learn more about the tax benefits of leveraging your firm's donor-advised fund (powered by Charityvest), your client can read detailed information provided in the Charityvest public guide.
Your client's donations are made to Charityvest, Inc., a Georgia Nonprofit Corporation recognized by the IRS as a tax-deductible public charity under Internal Revenue Code §501(c)(3), EIN 81-2771871.
A client contribution to their donor-advised fund is an irrevocable charitable gift to Charityvest, Inc., which provides them with the privilege to advise how their gift is used.
Because of the irrevocable legal nature of their gift, Charityvest provides them with a receipt showing that they made a charitable contribution (or that a contribution was made on their behalf by their advisor). This receipt includes:
Contribution date: date that the contribution was received according to IRS standards.
Contribution type: whether it was cash, stock, or another asset.
Contribution amount: the total value added to a client's giving account balance.
Estimated tax-deductible value: an estimate of the tax-deductible amount of the contribution. This may vary from the contribution amount, depending on the contribution type.
Only contributions are tax-deductible. Clients aren't eligible for additional deductions when they recommend a grant to charity, or if they transfer funds from an existing donor-advised fund or private foundation to their giving account.
To learn more about what is included in annual tax statements for a donor-advised fund powered by Charityvest, your client can read detailed information provided in the Charityvest public guide.
Transferring a client DAF to your firm's custom giving platform?
DAF transfers are not new charitable contributions, and are therefore not considered tax-deductible. When we process your client's DAF transfer, we will automatically mark it as not tax-deductible and it will not appear on their year-end tax statement.
It is simple for clients to access their DAF annual tax statements and download them for tax purposes. As an advisor, you can also retrieve client statements on their behalf.
To access their annual tax statements independently, clients can follow the instructions provided in the Charityvest public guide.
Has your client received a tax statement from a charity for a gift they made via their giving account?
Not all charities are familiar with tax receipting in relation to DAFs, which can mean that your client may receive a tax receipt from a charity if they included their contact details on their giving account grant recommendation.
If your client does receive a tax receipt from a charity in error, they may inform them of their relationship with your firm's custom giving program to avoid future duplication.
In general, a charitable contribution’s value is based on the type of asset donated and the date of contribution, which ordinarily is the date when the asset is transferred to Charityvest and unconditionally removed from the donor’s control. Gift value for the donor’s tax purposes is determined on the date of the gift, and is not related to the value the charity receives upon selling the property.
For publicly traded securities, the value we report is the average of the high and low quotation on the date the gift is received. This value may not be accurate for your client's tax situation (e.g., if the shares were not long-term basis).
For cryptocurrency, the value we report is the mid-market price reported by Coinbase at the time Coinbase recognizes the transaction on the blockchain, based on their internal policies for minimum confirmations per asset. While we anticipate that the IRS is likely to clarify rules around cryptocurrency donations soon, donors are still required to obtain such an appraisal related to gifts of cryptocurrency in excess of $5,000.
We provide three acknowledgment items for gifts of stock, plus a fourth for cryptocurrency:
E-mail acknowledgment. When we receive your gift and post it to your client's giving account, they will receive an email containing the details of their gift.
Unified annual statement. The details of their gift will be included on their annual statement, sent each January.
Form 8283. Form 8283 is an IRS tax form used to substantiate non-cash charitable contributions, like stock and cryptocurrency. Individuals, partnerships, and corporations use IRS Form 8283 to report information to the IRS about noncash charitable contributions when the amount of their contribution for all noncash gifts is more than $500. For donors whose previous year noncash charitable contributions exceed $500, we provide a blank IRS Form 8283 as a courtesy to our donors, along with the necessary information to complete the Form, excluding cost basis information, which is not furnished to us at the time of transfer. Cost basis information can be obtained with your help as their advisor, by logging into their brokerage account and reviewing positions and holdings activity.
Form 8282. For cryptocurrency donors only. Form 8282 (Donee Information Return) provides details regarding the disposition (i.e., sale) of their cryptocurrency asset following their gift. We furnish Form 8282 to both the donor, and to IRS.
To learn more about acknowledgements related to stock, ETF, and crypto donations to your firm's donor-advised fund account, your client can read detailed information provided in the Charityvest public guide.
Curious to learn more about your firm's custom DAF program? Contact your firm's program manager for program-related matters or Charityvest (support@charityvest.org) for platform-related matters.
