Case Study: A Donor Advised Fund for a Young Philanthropic Family

I have been involved with the Jewish Foundation of Greater Toronto and its Professional Advisory Committee (PAC) for about 10 years. My wife and I have a donor advised fund at the Jewish Foundation and I volunteer on PAC. My experience in tax and wealth management, along with my involvement with the Jewish Foundation, enables me to comfortably speak about donor advised funds and their benefits. Further, it brings me so much joy having the opportunity to explain what the Jewish Foundation is and how its knowledgeable philanthropic advisors can help people give charitably, while also gaining tax advantages.

This brings me to Lauren and Josh Strub—two people I know from the community, who expressed interest in learning more about donor advised funds. They described their motivation as wanting to give charitably with a side of pragmatic tax planning.

After several discussions with them, during which I gained a clear understanding of their philanthropic and financial goals, it was obvious to me that Lauren and Josh would highly benefit from a donor advised fund at the Jewish Foundation. What resonated the most with them about the Foundation was:

1. Making an impact in the short and long term
   The idea of creating a lasting impact for the Jewish community with a fund really struck a chord with Lauren and Josh. To be able to give charitably in their lifetime, while also ensuring that their fund can be used to help future generations felt like the perfect combination of philanthropic giving they were looking for. Additionally, the larger the overall foundation, the greater the security net for the Toronto Jewish community for use in extraordinary times. Lauren and Josh wanted to contribute to this security net.
2. Involving family
   It was incredibly important to them to be able to bring their children along their philanthropic journey. Their fund makes it easy for Lauren and Josh to involve their children in tzedakah (charity), lets them make decisions about the distributions, and teaches them how to make the most positive change in the community. By involving their children in decisions around tzedakah from a young age, they will feel empowered to continue giving, and it will ideally become an important part of their lives as they grow into adults.
3. Tax benefits and simplification
   As a bonus element, the tax benefits of a donor advised fund at the Jewish Foundation are very appealing. The Strubs received a tax receipt when they contributed to their fund but are able to choose various causes to support down the road. While their fund is a placeholder for their charitable dollars, the tax benefits are advantageous for their current financial situation. There is also a benefit of simplicity, as a fundholder can make all their charitable donations through the fund, thereby simplifying tax matters by dealing with just one charitable receipt and one organization, rather than many receipts and many organizations. The Jewish Foundation takes on the administrative task of distributing to individual charities, and since there is a special program where those under 45 years old can open a fund for just $5,000, many community members can take advantage of these features today.
4. Access to valuable community research and knowledge
   Another benefit of having a fund at the Jewish Foundation is having a dedicated philanthropic advisor. This allows the Strubs and their children to identify what they care about and leverage their philanthropic advisor’s expertise and knowledge in order to distribute funds to the appropriate organizations. The philanthropic advisors can also help guide distributions by helping to identify our community’s most urgent needs and priorities.

It was a gratifying experience to be able to meet with and help a wonderful family looking to make a difference in the Jewish community. I passed them on to their dedicated philanthropic advisor, who was able to personalize a plan for their charitable journey. As a volunteer with the Jewish Foundation, I knew I could lean on other volunteers, lay leaders, and professionals to finalize Lauren and Josh’s plans.

About the Author

Robert is the managing partner of HH Capital Partners, a boutique private equity firm positioned to acquire and operate small businesses. Robert is also acting as CEO of Staff Relief Healthcare Services, one of the leading providers of home and community healthcare services in Ontario. Robert earned an honours bachelor of business administration from the Schulich School of business. He is a chartered professional accountant, a chartered accountant, a chartered investment manager, a certified financial planner, a chartered life underwriter, and has his CICA in-depth tax certification.