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Home | Professional Advisors | Types of Funds

Donors decide which type of fund best suits their philanthropic goals. All funds accommodate anonymous giving or afford full recognition of a donor's generosity.

Donor Advised Fund

  • Donor makes a tax deductible gift.
  • Donor chooses name of the fund.
  • Donor periodically suggests grants to support nonprofit organizations.

The donor advised fund is the most popular fund type. Donors devise a name for the fund: the family's name or the name of a deceased loved one; a favorite book title or poem; a made-up name that includes all of the children's or grandchildren's initials. Donors make grant suggestions to support their favorite bona fide charities. These grants are paid from the income generated by investing the fund or from a combination of principal and income. The founding donor may appoint successor advisors to continue philanthropy into the next generation.

Supporting nonprofits is easy
To make a grant suggestion, a donor advisor merely mails or faxes a written suggestion to the LICF, or uses our web-based service Advisor Xpress, and the rest - assuring that the charity is bona fide, notifying the donor of the approval of the grant, issuing the grant check, and recording the payment - is work performed by the LICF and Trust staff. Donors receive a quarterly statement showing the availability of grantmaking funds, any additional contributions made to the fund, and a listing of grants paid during the accounting period.

Building an endowment for the future of the region
Many LICF donors use the donor advised fund to build an endowment with additional lifetime or deferred gifts, and by bequest.

Field-Of-Interest Fund

  • Donor makes a gift.
  • Donor chooses name of the fund.
  • Donor chooses area of particular interest.
  • LICF awards grants from field-of-interest fund through a competitive grants process.

The donor creates a field-of-interest fund by defining a particular area of charitable interest - child welfare, medical research, newly arrived immigrants, environmental preservation, racial justice, the visual arts - chooses its name, and then relies on the LICF staff to locate local nonprofit organizations whose work fulfills the mandate of the donor.

Field-of-interest funds, like all LICF funds, can be created during the lifetime of the donor, through deferred gift, or by bequest. For the tax years 2006 and 2007, taxpayers over the age of 70.5 may rollover up to $100,000 annually from an IRA into a field-of-interest fund.

Designated Fund

  • Donor makes a gift.
  • Donor chooses name of the fund.
  • Donor chooses specific nonprofit organization to support.
  • Grants are awarded from income generated by the fund, or principal depending on the donor's wishes.

Donors who are committed to supporting a particular charity may prefer a designated fund. The donor chooses the charity to benefit. If the charity goes out of business, changes its mission, or circumstances change, the support from the designated fund will be redirected to other charities without losing time or depleting resources to seek a court order, a procedure that is required when a private foundation seeks to change its focus. For tax years 2006 and 2007, taxpayers over the age of 70.5 may rollover up to $100,000 annually from an IRA into a designated fund.

Community Response Fund

  • Donor makes a gift.
  • Donor chooses name of the fund.
  • LICF staff awards grants to support local nonprofit organizations through a competitive grants process.

A donor may create a community response fund or allocate a portion of the income and/or principal of a donor advised fund to be used by the LICF board and staff to respond to Long Island's pressing needs. These community response grants are awarded through a competitive grants process. Three times a year the LICF board issues grants to Long Island nonprofit organizations that are engaged in addressing critical issues within their communities and helping to enhance the capacity of nonprofit organizations to work effectively in those communities. Specific critical issues are targeted - institutional racism, lack of affordable housing, inadequate public transportation, conflict surrounding new immigrants, differential access to quality health care - as well as other issues as they might arise.

Donors creating community response funds or allocating a portion of their donor advised funds to the LICF for grantmaking are relying on the LICF's greatest asset, its in-depth knowledge of Long Island's needs and the organizations serving the region.

For tax years 2006 and 2007, taxpayers over the age of 70.5 may rollover up to $100,000 annually from an IRA into a designated fund.