As the year draws to a close, many clients are thinking about charitable giving—and advisors have a timely opportunity to help them approach it strategically. Donor-Advised Funds (DAFs) continue to be one of the most effective tools for those who want to connect thoughtful philanthropic and tax planning.
Why now? Upcoming changes to charitable deduction rules
The One Big Beautiful Bill Act (OBBBA) is expected to take effect in 2026, which will introduce new caps, floors, and grantee eligibility considerations to the tax treatment of charitable gifts. For many high-net-worth clients, accelerating DAF contributions before the end of 2025 could lock in more favorable tax treatment under current rules. Advisors can use this window to initiate or expand conversations about year-end giving and long-term philanthropic goals.
Aligning values, taxes, and impact
Beyond their tax advantages, DAFs present a powerful way to unify giving and investing. By aligning a DAF’s investment portfolio with the causes it ultimately supports, advisors can help clients ensure their dollars are working consistently toward their values—avoiding contradictions like funding animal welfare initiatives while holding companies that conduct animal testing.
Flexible gifting
DAFs can also help clients liquidate a range of complex assets beyond appreciated listed securities, including limited partnership interests, real estate, pre-IPO stock, or even cryptocurrencies. Tax implications or values misalignment may compel clients to gift such assets, regardless of their complexity, helping clients repurpose wealth toward lasting impact.
How Ethic supports advisors
At Ethic, we help advisors manage the full DAF lifecycle—from account setup and funding to ongoing, values-aligned portfolio management and transparent reporting that connects financial outcomes to philanthropic goals.
Whether clients are seeking tax efficiency, legacy planning, or a meaningful family giving experience, integrating DAF strategies into broader portfolio discussions allows advisors to deepen relationships and demonstrate a commitment to the person behind the portfolio.
Interested in opening a Donor-Advised Fund?
If you're already an Ethic client, connect with your relationship manager or email clients@ethic.com to get started. If you're new to Ethic, fill out our contact form and our team will be in touch with you shortly.
