How to Set Up a Donor-Advised Fund
A donor-advised fund (DAF) might sound complex, but it’s one of the easiest and most effective ways to give to the causes you care about—with built-in tax benefits and flexibility that fits your lifestyle. Whether you’re a busy professional looking to give back more intentionally or someone marking a life milestone with community generosity, this guide will walk you through how to set up a donor advised fund, step by step.
Let’s explore how this giving approach works—and how you can use GoFundMe Giving Funds to make your philanthropy more impactful and easier to manage.
Choosing a sponsor organization
Before you can create a DAF, you’ll need to choose a sponsor. A DAF sponsor is a public charity that administers and manages donor-advised funds on behalf of individuals, families, and organizations.
Not all DAF sponsors are the same. Some offer complex, investment-heavy products that are better suited to institutions. Others – like our GoFundMe Giving Fund – are built for everyday donors looking for a more accessible, values-driven way to give.GoFundMe Giving Funds makes it simple: a modern, user-friendly experience that helps you organize, track, and grow your giving—without the red tape or minimums.
Setting your charitable goals
The most meaningful giving starts with intention. Think about what motivates you to give:
- Are you moved by emergency relief ?
- Do you care deeply about education, mental health, or local nonprofits?
- Are there schools or charities you already support regularly?
Naming the causes that matter most to you helps shape how you use your DAF—and makes your giving more personal and powerful.
Deciding on the contribution amount
A common misconception is that you need thousands of dollars to start a DAF. And this definitely isn’t true—especially with a GoFundMe Giving Fund.
You can start with as little as $5.
All contributions to your Giving Fund are tax-deductible in the year they’re made, and if you itemize deductions on your taxes, you may be able to deduct up to 60% of your adjusted gross income for cash contributions or 30% for long term appreciated assets (like stock), subject to IRS rules.
Pro tip: don’t let “tax season” dictate your giving—your GoFundMe Giving Fund lets you contribute when it’s tax-smart for you, then give to causes on your own timeline.
Funding your DAF
Once you know how much you’d like to contribute, it’s time to fund your DAF. With our Giving Funds, we accept:
- Cash
- Credit and debit card donations
- Publicly traded stock (coming soon)
Donating long-term appreciated assets can help you avoid capital gains taxes while maximizing your donation’s value. For example, if your stock has increased in value, donating it directly allows you to deduct the full fair market value without paying tax on the gain.And when you contribute through GoFundMe Giving Funds, you receive one simple tax receipt, even if you end up giving to dozens of causes throughout the year.
Setting up your GoFundMe Giving Fund
Here’s how to start a donor-advised fund in just a few easy steps:
- Create a GoFundMe account (or sign in if you already have one).
- Navigate to Giving Funds.
- Set up your fund by choosing a name and making your initial contribution (starting at just $5).
- Set a goal and select your investment preferences, if you’d like to grow your fund.
- Start recommending grants—to nonprofits, schools, or even crisis funds that support individuals.
The entire process takes just minutes, and you’ll be able to give anytime, from anywhere.
Advising and recommending grants
Once your fund is set up, you can start recommending grants. This simply means choosing where you’d like your donations to go – GoFundMe Giving Funds ensure your money reaches eligible 501(c)(3) charities, schools, or religious organizations.
The beauty of a DAF is that you can recommend grants at your own pace—today, next month, or next year. With Giving Funds, you also have the unique option to give to charitable organizations that support urgent needs or individuals through vetted crisis funds, so you can help real people in real time.
DAFs vs. alternative charitable giving options
Here’s how donor-advised funds stack up:
| Giving Method | Benefits | Considerations |
| DAFs | Tax-deductible upfront, funds can potentially grow tax-free, grant anytime | Must give to eligible nonprofits |
| Private Foundations | Full control, tailored mission | Complex setup, costly to maintain |
| Direct Donations | Immediate impact, no setup needed | Less strategic or trackable |
GoFundMe Giving Funds combine the ease of direct giving with the strategic power of a DAF, all within a product designed to help people and communities thrive.
Take the next step toward intentional giving
Setting up a DAF doesn’t need to be complicated or expensive. With us, it’s as easy as:
- Choosing what matters to you
- Contributing what you can
- Supporting the nonprofits and causes you care about
Whether you’re planning to give $100 or $10,000, your GoFundMe Giving Fund becomes a simple, powerful tool for tax-smart giving that allows you to make a real impact year-round.
This content is for educational purposes only and does not constitute tax, legal, or investment advice. Any financial or tax-related calculations provided are illustrative examples only and should not be relied upon for making financial decisions.
Laws and regulations regarding donor-advised funds vary, and tax benefits depend on individual circumstances. Readers should consult with a qualified tax, legal, or financial professional for personalized guidance.