A Donor Advised Fund makes it easier for you to set up one gifting account from which regular charitable distributions for OMS missionaries and programs, as well as other ministries, may be made. The program made available through WaterStone, our service provider, gives you an alternative to commercial gift funds and to the legal and tax complexities of establishing and operating a private foundation. A Donor Advised Fund offers administrative support, experienced grant-making counsel and careful financial management.

WaterStone is a 501(c)(3) Christian non profit with a passion for helping you transform your assets into living water for the training of nationals as church leaders and workers through OMS.

How a Donor Advised Fund Works

An individual completes the WaterStone Donor Advised Fund application and makes a minimum initial donation of $1,000. You name your family fund and recommend the charitable purpose of the fund, including specific OMS missionaries and ministries. OMS encourages a minimum annual distribution of 10% of the fund. After approving your recommendation, distributions may begin and are identified as coming from your Donor Advised Fund. (Placing this ultimate distribution authority in WaterStone’s hands ensures that your donation establishing the Donor Advised Fund is complete in the eyes of the IRS and therefore deductible.)

For the most favorable stewardship, you should consider a DAF of at least $25,000 so the assets may be individually invested with the earnings accruing into your fund. Additional contributions to the fund can be made at any time.

WaterStone charges a reasonable annual Administrative Fee between .75% and 1.25% ($195 minimum).

Making Distributions or Grants

You recommend the recipients of annual distributions from your Donor Advised Fund directly to WaterStone. We at OMS encourage that a minimum of 25% of the annual distribution be sent to OMS. Similarly, on termination of the Donor Advised Fund, we encourage that 25% of the assets remaining in the fund be distributed to OMS. Due to IRS requirements and standards, a distribution request that would benefit the donor or related party, a private foundation, political activities or for any purpose that is not wholly charitable and consistent with the WaterStone Statement of Faith and Purpose will not be made.

Comparison

Comparing the WaterStone Donor Advised Fund with other commercial funds or private foundations shows these advantages:

• A current deduction at 50% of adjusted gross income is possible, compared with 30% in a private foundation.
• There is no tax on net-investment income on the fund, as there is in a private foundation. 
• Our costs are much more moderate than a commercial fund or private foundation. 
• Tax compliance and other administrative and distribution services are provided for you.

How Do I Create A Donor Advised Fund?

For further information and assistance, please contact Diane Arndt or Steve Hoffman of our Gift and Estate Design services team or Sue Smith at WaterStone.

Phone: 1-317-881-6755 ext. 334 (Diane Arndt)
Phone: 1-719-447-4620 (Sue Smith)