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What does it mean that an existing DAF transfer is not tax-deductible?

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When it's mentioned that an existing DAF transfer is not tax-deductible, it means that once you've made a contribution to a Donor-Advised Fund (DAF), you can't claim a tax deduction for transferring those funds to another DAF. However, the initial contribution you made to the DAF is tax-deductible. DAFs, like Daffy, are an excellent way to manage your charitable giving. They allow you to make a tax-deductible contribution, invest it, and then decide later which charities to support. The money grows in an investment account, enabling you to make a more significant impact over time. Daffy offers a variety of investment options, including stocks, bonds, and cryptocurrency. When you're ready to donate, you can do so directly through the app, making it easier to track your deductions during tax season. For example, let's consider Leah, a senior manager at a tech company. She earns $200,000 a year and received a $20,000 bonus. She decides to contribute her bonus to a DAF. This contribution is tax-deductible, reducing her taxable income and potentially saving her thousands of dollars in taxes. Daffy stands out as a DAF provider due to its low fees, starting at just $36 a year. This is significantly lower than traditional providers, which often charge high administrative fees. Transferring a DAF account to Daffy is easy and free of charge, allowing you to maximize your charitable giving. In addition to tax benefits, Daffy offers other advantages. You can contribute cash, stocks, or crypto to your DAF and take an immediate tax deduction. Your contributions are invested in a portfolio of your choice, and you can donate to over 1.5 million charities whenever you want. In conclusion, while transferring an existing DAF is not tax-deductible, the benefits of using a DAF like Daffy for your charitable giving are numerous. From tax deductions on contributions to low fees and flexible giving options, Daffy is a great choice for managing your charitable donations.

Please note that the information contained on this page is for educational purposes only and should not be considered tax advice. Any calculations are intended to be illustrative and do not reflect all of the potential complexities of individual tax returns. To assess your specific tax situation, please consult with a tax professional.

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