Donor-advised fund calculator
Donating appreciated stock to a DAF instead of cash sends more to your church — the capital gains tax that would have gone to the IRS goes to your ministry instead. Enter your investment below and see the difference side by side.
Your investment
Assumes held >1 year (long-term capital gain). Short-term gains are taxed as ordinary income and the math is less favorable.
Your tax rates
How a donor-advised fund works
A DAF is a giving account sponsored by a public charity. You transfer assets, get an immediate deduction, and recommend grants to your church or other ministries on your own timeline. Here's the sequence:
- Contribute appreciated shares. Transfer stock, mutual fund shares, or ETF shares directly into the DAF. The DAF sponsor sells them with no capital gains tax. You get an immediate charitable deduction for the full fair market value.1
- Invest (optional). The balance stays invested inside the DAF — tax-free — until you're ready to grant.
- Recommend grants. Direct grants to your church, a mission organization, a food bank — any qualified 501(c)(3) — in any amount, at any time. Many families grant monthly to their church while funding the DAF in concentrated high-income years.
The result: your church receives more than it would if you sold the stock first, and you may also owe less tax than if you donated cash (because the larger deduction is worth more than the tax savings from Option A after paying the capital gains).
Why this matters for Christian families
Generosity flows from conviction, not tax law. But stewardship includes the tax side: if a $50,000 stock position can generate $4,500 more for your church at no extra personal cost, a stewardship-minded plan captures that. The capital gains tax that would have gone to the IRS goes to your ministry instead. That is not a tax strategy — it is faithfulness with what you have been given.
Practical uses for Christian households
- Tithe an irregular year. Sold a business, exercised stock options, or had a large bonus? Fund a DAF in that high-income year — concentrating the deduction — then grant to your church over time.
- Give low-basis stock from your brokerage. The most common use. Even $5,000 in a long-held position avoids the gain and qualifies for the full deduction.
- Bundle several years of giving. In a year when you can itemize, fund a DAF with two or three years of planned giving at once. The church receives grants annually; the tax benefit is concentrated.
- Legacy generosity. A DAF can receive a bequest and continue distributing to your chosen ministries for years after your estate settles.
DAF vs. qualified charitable distribution (QCD)
| Donor-Advised Fund (DAF) | Qualified Charitable Distribution (QCD) | |
|---|---|---|
| Who can use it | Anyone with a taxable brokerage account | IRA owners age 70½ or older only |
| Asset source | Appreciated stock, mutual funds, or cash | Traditional IRA (not 401(k)) |
| Tax benefit | Deduction for full FMV; capital gains tax avoided on stock | Distribution excluded from gross income entirely |
| Best when | You itemize and have appreciated positions | You take the standard deduction, or want to reduce AGI for IRMAA |
| 2026 annual limit | 30% of AGI for capital property; 60% for cash (5-year carryforward)2 | $111,000 per IRA owner3 |
| Timing | Fund now; grant over multiple years | Must go directly to charity — cannot pass through a DAF |
Many retirees use both: QCDs to satisfy their tithe and reduce required minimum distributions, and a DAF for any appreciated stock positions. Use our QCD calculator to see those savings separately.
DAF sponsors to know
- National Christian Foundation (NCF) — faith-based DAF sponsor; grants to churches and ministries worldwide. Includes donor advising alongside the account. Minimum: $1,000.
- Fidelity Charitable / Schwab Charitable / Vanguard Charitable — large secular sponsors with low minimums (Fidelity: $50 to open, $50 minimum grant). Full investment options. Your church receives grants regardless of which sponsor you choose.
- National Catholic Community Foundation — DAF sponsor aligned with Catholic givers and USCCB investing guidelines.
Sponsors differ in minimum balances, fees, investment options, and whether you want a faith-based giving relationship. A stewardship-minded advisor can help you choose one that fits your situation.
Frequently asked questions
What is a donor-advised fund?
A DAF is a charitable giving account. You contribute assets to the account (run by a sponsoring charity), get an immediate deduction, and recommend grants to qualified charities — including your church — over time. The key advantage: appreciated stock donated to a DAF is never subject to capital gains tax.
Why give appreciated stock instead of cash?
When you sell stock and donate the cash, you pay capital gains tax first, reducing what your church receives. Donating shares directly avoids that tax entirely — the full fair market value goes to your church — and you get the full deduction. For stock held more than one year, this is almost always the more effective approach for both you and your church.
Can I use a DAF to pay my tithe?
Yes — virtually all U.S. churches are 501(c)(3) charities. You can fund the DAF in a high-income year and recommend grants to your church monthly or annually. Many families set up automatic monthly grants so the church experience is unchanged while the tax side is handled separately.
What is the difference between a DAF and a QCD?
A QCD comes from an IRA and is only available to IRA owners 70½ or older; the distribution is excluded from income. A DAF accepts appreciated stock or cash at any age and provides a deduction. If you use the standard deduction, a QCD is often better. If you itemize and have appreciated investments, a DAF is usually superior. Many retirees use both.
Is there a minimum contribution?
Most sponsors require $1,000–$5,000 to open a DAF account, and $50–$250 per grant. Fidelity Charitable has among the lowest minimums. There's no legal minimum — just sponsor policies.
- IRS Publication 526, Charitable Contributions: irs.gov/publications/p526 — covers deductibility of appreciated property contributed to public charities and donor-advised fund sponsors; fair market value rule for long-term capital assets (held >1 year).
- IRC §170(b)(1)(B) and (e)(1): 30% of AGI limit for contributions of long-term capital property to public charities; deductible at fair market value when held more than one year. Five-year carryforward per IRC §170(d).
- IRC §408(d)(8); IRS, IRA Qualified Charitable Distributions. The 2026 QCD limit is $111,000 per IRA owner (inflation-adjusted annually).
- IRS, Donor-Advised Funds — overview of DAF rules, qualifying distributions, and recordkeeping requirements.
Tax rules verified as of June 2026. Federal tax rates shown; state taxes, AMT, NIIT phaseouts, and individual AGI limits may vary. This page is for educational purposes — not tax advice.
Want help building this into your plan?
A stewardship-minded advisor can walk you through whether a DAF, a QCD, or a combination fits your household — and connect your giving strategy to retirement, investing, and tax planning in one coordinated plan. Free, no obligation.