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New IRS Regulations for Donor-Advised Funds: Key Provisions, DAF Exceptions, Taxable Distributions and Expenditures

Recording of a 90-minute CLE/CPE video webinar with Q&A

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Conducted on Tuesday, February 6, 2024

Recorded event now available

or call 1-800-926-7926

This CLE/CPE webinar will provide estate planners and tax practitioners guidance on key provisions and the impact of recent proposed IRS regulations for donor-advised funds (DAFs). The panel will discuss critical provisions of these regulations, the tax treatment of distributions and expenditures, DAF exceptions, and other key items stemming from these regulations and their impact on estate and tax planning.

Description

On Nov. 13, 2023, the IRS released proposed regulations providing guidance on tax rules relating to DAFs. These regulations, if promulgated, will have a significant impact on estate and tax planning, forcing estate planners and tax professionals to have a firm understanding of these tax rules to determine the best course of action and available options for charitable giving as part of an estate plan.

DAFs allow privacy, an immediate tax deduction, and create planning opportunities. DAFs facilitate the "bunching" strategy. Taxpayers can front-load contributions just before retirement or make a large deductible contribution in a year with extraordinary income. A DAF is an account that is maintained by a public charity and funded by contributions from donors. The donor or donor advisor "advises" the charity on investments or disbursements to be made.

The recent regulations add special rules, including an excise tax that governs transactions and benefits by donors, advisors, and other persons, and also rules to address distributions from DAFs, including “taxable distributions.” In addition, the regulations also expand the definition of certain terms that clarify the scope of accounts treated as DAFs and the distributions constituting taxable distributions.

Listen as our panel discusses key provisions of these regulations, the tax treatment of distributions and expenditures, DAF exceptions, and other key items stemming from these regulations and their impact on estate and tax planning. The panel will also discuss the framework for structuring DAFs and their use as an estate planning tool and other options available to estate planners.

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Outline

  1. Overview of DAFs pre-regulations
  2. The role of DAFs from a giving and estate planning perspective
  3. How the regulations would change considerations for donors
  4. The single identified organization DAF exception
  5. How the regulations would change permissible DAF distributions
  6. Possible future regulations and laws

Benefits

The panel will discuss these and other key issues:

  • What constitutes a DAF?
  • Utilizing a DAF as an estate planning and charitable giving tool
  • Sponsoring and managing a DAF for charities
  • What a single identified organization fund (not a DAF) can and can’t do
  • What are the types of sponsoring organizations and considerations of each?
  • What are the main issues raised by critics of the regulations?
  • What may future DAF regulations cover?

Faculty

Mill, Karl
Karl Mill

Founding Attorney
Mill Law Center

Prior to founding Mill Law Center, Mr. Mill was a partner at Adler & Colvin, a boutique law firm serving...  |  Read More

Takagi, Gene
Gene Takagi

Principal
NEO Law Group

Mr. Takagi is a Principal at NEO Law Group, Contributing Publisher of the Nonprofit Law Blog, and a P/T Lecturer at...  |  Read More

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Strafford will process CLE credit for one person on each recording. CPE credit is not available on recordings. All formats include course handouts.

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