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A Guide to Donor
Advised Funds -Thank you for your interest.
The mission of
the Ireland Funds is to be the largest worldwide network of people
of Irish ancestry and friends of Ireland dedicated to raising
funds to support programs of peace and reconciliation, arts and
culture, education and community development.
For more than
20 years, The American Ireland Fund [AIF] has been helping the
people of Ireland rebuild and reinvigorate their homeland, and
share their vibrant culture with a receptive world.
Help from The American
Ireland Fund and its supporters have taken many forms. Consistently,
and on behalf of all the Irish people, The AIF has supported grass
root initiatives - conceived and implemented by those who should
know best, the Irish people themselves.
Our support falls
into four giving areas:
· Peace & Reconciliation
· Community Development
· Education
· Arts & Culture more >
The worldwide network
of Ireland Funds invented organized giving to benefit the people
of Ireland. Our founders, themselves of Irish descent, were convinced
that there were people all around the world who felt an ancestral
connection to Ireland.
Who might feel
such a connection? Most likely, they would be members of the "Irish
Diaspora" whose forebears had sailed away from their beloved
but depressed island and people, who, for several generations
in adopted homelands, had worked hard and prospered, People ready
to give back to the land of their ancestors, although having left
under difficult circumstances - had nevertheless cherished and
handed down the fond memories of Ireland that they held in their
hearts.
There is also a
strong and growing continent of people around the world who consider
themselves friends of Ireland. Those whose ancestry might not
be Irish, but their connection to Ireland has grown through their
love for Irish literature and culture.
Around the world,
and especially in the United States, people of Irish descent
and friends of Ireland have responded magnificently to this
vision. All told, The Ireland Funds have raised more
than $300 million to benefit Irish people. We have helped
to launch countless worthy causes and enabled may more to
pursue new opportunities.
Ireland now holds
greater hope for a strong and peaceful future than it has had
for many years. Powerful forces are reversing the Irish Diaspora.
People from many lands now seek to live a better life in Ireland.
For the first time since the Famine, immigration to Ireland outpaces
emigration from Ireland. Progress towards peace, a new spirit
of entrepreneurship, which infuses the Irish people, and an extraordinary
upswelling of cultural celebrations in Ireland's cities and towns
- are all auspicious signs, heralding a new era of confidence
on this small but mighty island.
Yes, much has changed
for the better. But behind the headlines, much more remains to
be done. Today the financial needs of the projects supported by
The American Ireland Fund are orders of magnitude many times greater
than amount we are able to give. For every project we support,
The American Ireland Fund must refuse ten applications for projects
or programs that are also worthy of funding.
Donor Advised
Funds: The components of endowment
The American Ireland
Fund's endowment, while managed on a consolidated basis for investment,
legal and tax purposes, is in reality a series of individual donor
advised funds. Each of these donor advised funds has a unique
perpetual identity. Every fund has its own name, often that of
the donor or donor's family, occasionally that of a memorialized
individual, or other title reflecting its origin and objectives.
Each fund has its
own stated charitable purpose; in many cases the unrestricted
support of Ireland, North and South. In other cases the purpose
is a more defined geographic focus or charitable field of interest.
Charitable distributions from individual funds are advised by
their respective donors through periodic recommendations to the
Board of Directors of The American Ireland Fund.
These are numerous
effective means by which to establish an advised fund. Some are
funded by lifetime gifts, some by bequest, and others by planned
giving instruments such as charitable remainder trusts or gifts
of life insurance.
Finally donors,
family and friends are able to add to the fund, and thereby renew
and enlarge their commitment to Ireland whenever a funding opportunity
and interest arises.
Three types of
Funds
Unrestricted
Fund : Unrestricted funds are
not restricted by their donors to any one purpose. They are used
in the best judgment of The American Ireland Fund's Board of Directors
to meet Ireland's most pressing problems. These are the most flexible
funds and, in many ways, the most responsive to changing needs.
Field Of Interest
Fund : Field of interest funds
have been established to support particular fields or geographical
areas that are of interest to donors. They include many aspects
in the four key giving areas: peace and reconciliation, arts and
culture, education and community development.
Donor Recommended
Fund : Donor recommended funds
are established by donors who wish to be actively involved in
choosing which organizations receive grants from their funds.
The Board of Directors considers each donor's recommendations
concerning specific charities or fields of interest
Some examples...
A few specific
examples will help describe the variety of options available in
establishing permanent funds within the AIF.
One fund specifies
that charitable distributions from that family fund are to be
made with a preference for educational and cultural programs and
for organizations helping women and children. This fund is growing
through a series of annual pledged gifts and a bequest.
Another fund established
upon the death of a long-time AIF board director, provides annual
unrestricted grants in the director's memory to honor his lifelong
commitment to Ireland. The fund grew from memorial gifts and continues
to receive occasional contributions from family and friends.
A third fund was
designed with a preference for grants to the two counties from
which the donor's forbears emigrated. This fund was established
with the proceeds from a life insurance policy taken out by the
donor for this purpose.
Finally, an AIF
fund created by grants from a US private foundations enables the
trustees of that foundation to provide resources for Ireland without
encountering the potential legal and tax complications of direct
grants by the private foundation abroad.
The range, purpose
and design of individual donor advised funds within The American
Ireland Fund are as diverse as the donors who have created them.
The common thread, of course, is a love for Ireland and the belief
that its quality of life may be improved by private philanthropy.
How to create
your own Donor Advised Fund:
Whether by present
gift, bequest or otherwise, a new fund may be designed at any
time in consultation with The American Ireland Fund staff. The
donor simple names the fund and drafts its purposes. If it is
to be advised, the advisor or advisors should be named. This information,
in the form of a simple resolution will then be presented for
adoption to the Board of Directors of The American Ireland Fund.
Donations to a
Donor Advised Fund many take many forms as outlined below. Generally
such funds should be planned to reach $100,000 or more, although
The American Ireland Fund will consider smaller funds as well.
As a tax-exempt organization incorporated under the laws of the
United States, The American Ireland Fund offers donors the full
benefit of federal tax deductibility for all properly structured
contributions.
Cash:
For federal income tax purposes, cash contributions may be deducted
up to 50% of an individual's adjusted gross income. Contributions
in excess of those amounts may be deducted over five succeeding
years.
Securities:
Gifts of appreciated securities may offer considerable advantages
to the donor. For donors not subject to the alternative minimum
tax, such gifts are deducted at a full market value ay the time
of the gift up to 30% if an individual donor's adjusted gross
income. No capital gains tax is paid. Contributions in excess
of those amounts may be deducted over the five succeeding years.
Bequests:
The American Ireland Fund can be remembered in a will by designation
of a dollar amount or be named as the residual beneficiary of
a donor's estate. A bequest will not by subject to estate taxes.
Real Estate:
Gifts of appreciated real estate offer similar advantages. It
may also be beneficial for a donor to make a gift to the Fund
of a future interest in real estate. A donor might, for example,
retain life interest in a residence and give the remainder interest
to The American Ireland Fund. Such a gift gains an income tax
deduction for the donor in the year of the gift and also eliminates
any estate tax on the property.
Life Income Gifts:
There are a number of ways in which gifts can be made subject
to life income agreements including annuity trusts, unitrusts
and a pooled income fund. Income is paid to a donor or beneficiary
during his or her lifetime with the remainder interest added to
a fund specified by the donor. These are often substantial income
and estate tax benefits under such agreements.
Life Insurance:
In most states, gifts of life insurance policies may be made naming
The American Ireland Fund as owner and beneficiary. The donor
receives an immediate income tax deduction of the policy's present
value and eliminates the proceeds of the policy from his or her
estate. The premiums paid thereafter by the donor are deductible
from federal income tax.
Private Foundation
Giving:
Private foundations have found it practical and economical to
transfer all or part of their assets to establish funds within
The American Ireland Fund. Such foundations are able to provide
resources for Ireland without the legal and tax complications
of direct grants abroad.
Corporate Donations:
Corporations may find it advantageous to establish an advised
fund. The corporation can make contributions to The American Ireland
Fund in years when profits are high and then may recommend charitable
distributions in subsequent years of both income and principal
when profits may be lower or charitable needs greater.
Investment Management
Individual Donor
Advised Funds are invested as part of The American Ireland Fund's
pooled endowment. The objective of endowment management is to
maintain or increase the purchasing power of capital and income
over the long term while providing a reasonable return for current
distribution. Because of the importance of endowment return to
the Fund and its beneficiaries, growth of income and principal
is sought at the lowest possible risk.
Broad diversification
of The American Ireland Fund's endowment is practiced within the
constraints of effective and cost efficient management. The endowment
is run on a pooled basis to assure full diversification for the
individual Donor Advised Funds within it.
The Finance Committee
of The American Ireland Fund, consisting of individuals with broad
financial and investment experience, provides oversight and review
of general policies and investment management performance.
Although individual
funds are pooled for investment purposes, The American Ireland
Fund works on a fund-by-fund basis to optimize market values and
investment income, thereby assuring its ability to honor individual
fund restrictions and distribution requirements.
Why Work with
The American Ireland Fund ?
The American Ireland
Fund is an ideal vehicle for donors wishing to benefit a land
and people whose contributions to America are unique and long
lasting. The Fund is non-political and non-sectarian and professionally
managed. It is governed by a Board of Directors comprised of business
and cultural leaders, primarily from the United States. An Advisory
Committee in Ireland, broadly representative of community interests,
North and South, Protestant and Catholic, reviews grants applications
and makes recommendations to the Board of Directors.
A fund in the AIF
provides a very attractive alternative to establishing a private
foundation. Full-time, professional staffs are located both in
Ireland and the U.S. to take care of all administrative and grant
making activated. This eliminates the need for a donor to take
on the arduous task of setting up a separate institution, filing
numerous forms and soliciting and monitoring the status of grant
recipients. While establishing a private foundation can take months
and be costly: with the AIF, the legal apparatus is already in
place, and creating a Donor Advised Fund can take less than a
day.
The American
Ireland Fund is a tax-exempt organization, incorporated under
the laws of the United States, and has been determined by the
IRS to be a public charity under section 501 [c] [3] of the Internal
Revenue Code.
The American
Ireland Fund is audited annually by Grant Thornton and a copy
of the most recent financial statement is available upon request.
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Procedures
for Operation of Donor Advised Funds
Section
1. Establishment And Purpose
1.1
The American Ireland Fund has authorized and ratified the
establishment of Donor Advised Funds by Resolution of the
Board of Directors [hereinafter "Board"]. This
Resolution authorizes the adoption of these procedures for
the administration of Advised Funds. These procedures may
be amended from time to time, when deemed necessary or desirable
by the Board.
1.2
Establishment of Advised Funds: Advised Funds may be established
by the donation or transfer by any person [hereinafter "Donor"]
to The American Ireland Fund of money or property, whether
by contribution, gift, bequest or devise or by transfer
from a charitable or other organization [hereinafter "
contribution"], to further or carry out the purposes
of The American Ireland Fund, as set forth in its Articles
of Incorporation. Advised Funds shall be administered as
a component fund of The American Ireland Fund.
1.3
Nature And Terms of Advised Funds: Each Advised Fund shall
be the property of The American Ireland Fund owned by it
in its normal corporate capacity. In such capacity, The
American Ireland Fund shall have the ultimate authority
and control of all property in the Advised Fund, and the
income derived there from, for the charitable purposes of
The American Ireland Fund. Each Advised Fund may be recorded
on the books and records of The American Ireland Fund as
an identifiable or separate Advised Fund and my be given
a name or other appropriate designation as requested by
the Donor.
1.4
General Endowment Fund: In September of each year, 5% of
each individual Advised Fund will be subtracted from
that fund and credited to the general AIF fund established
for unrestricted grant purposes.
1.5
Forms: The Chief Executive Officer of The American Ireland
Fund is authorized to provide forms for the establishment
of Advised Funds and such other forms as are necessary or
desirable for the administration of Advised Funds in accordance
with these procedures.
Section 2. Acceptance Of Advised Funds
2.1
Authorization: The Chief Executive Officer of The American
Ireland Fund [or such officers or employees of The American
Ireland Fund as the Board may from time to time authorize]
shall have the authority to accept, on behalf of The American
Ireland Fund, contributions to establish or add to an Advised
Fund. A Donor may not impose any material restriction or
condition that prevents The American Ireland Fund from freely
and effectively employing the contributed assets, or the
income derived therefrom, in furtherance of a charitable
purpose of The American Ireland Fund.
2.2
Minimum Contribution: The minimum amount to establish an
Advised Fund is $25,000
Section 3. Investment of Fund Assets
3.1
Responsibility: The American Ireland Fund has the sole responsibility
and authority for the investment of the assets of each Advised
Fund. The assets of any Advised Fund may be commingled with
those of other Advised Funds, or with other funds of The
American Ireland Fund, or may be invested in units of a
common investment fund, which may be established or utilized
by The American Ireland Fund.
However,
The American Ireland Fund shall have no obligation to commingle
the assets for investment purposes and may, in its discretion,
retain any assets received or hold the assets of an Advised
Fund as a separate unit for investment purposes.
3.2
Administration: Decisions with respect to the retention,
investment or reinvestment of assets and with respect to
commingling of assets shall be made by the Board, upon review
of investment performances submitted by the Finance Committee
and Board Treasurer, agent or director authorized by the
Board, in accordance with procedures as set by the Board.
Section 4. Distributions from The American Ireland Fund
4.1
In General: The Board has the right to direct all distributions
of income [and principal unless not allowed by the creating
document] of Advised Funds. The Donor of an Advised Fund
[ or his designee, as permitted in section 4.2 below] may,
after the contribution of money or property to an Advised
Fund, recommend to The American Ireland Fund from time to
time distribution from the Advised Fund which are consistent
with the specific charitable needs of The American Ireland
Fund. The AIF Board shall consider and evaluate all such
recommendations, but such recommendations will be solely
advisory and The American Ireland Fund is not bound in any
way by such recommendations.
4.2
Donors And Their Designees Accorded The Privilege of Making
Recommendations: The privilege of making recommendations
[as described ins section 4.1 above] shall be extended to
Donors and their designees, subject to the following limitations:
A - Donor
& Spouse: If an individual establishes an Advised Fund,
the privilege of making recommendations will be limited
to the Donor and his or her spouse during their lives, unless
otherwise specified, e.g. donor intends for children to
have recommendation privileges.
B - Corporations:
A corporate Donor that establishes an Advised Fund will
have the privilege of making recommendations for a period
not to exceed 20 years from the date of establishment of
the Advised Fund. The privilege to make recommendations
may be extended beyond the 20-year limitation if substantial
additional contributions are made and the corporation maintains
a continuing charitable involvement with The American Ireland
Fund. Such a corporation, or those acting on its behalf,
shall designate one person [and may designate his or her
successor] to submit the recommendations of the corporation
to The American Ireland Fund.
In the
following Sections, the terms Donor will apply to all persons
having the privilege of making recommendations as provided
above.
4.3
Limitations: The following limitations apply to all distributions
from Advised Funds -
A - Minimum
Distribution: The minimum amount any one distribution from
an Advised Fund shall be $5000, although the Board may,
from time to time, set a higher limitation.
B - The
American Ireland Fund, as a public charity, will not make
any distribution from an Advised Fund except as a distribution
from The American Ireland Fund for its charitable purposes,
and no such distribution may be used to discharge or satisfy
a legally enforceable pledge or obligation of any person,
including the Donor of an Advised Fund.
C - A
Donor of an Advised Fund or any other person may not receive
any significant tangible benefit or privilege in return
for a distribution from an Advised Fund.
4.4
Procedures : Recommendations by Donors: All recommendations
by a Donor with respect to distributions from and Advised
Fund must be made in writing, addressed to The American
Ireland Fund. Staff Investigation : Each grantee by a Donor
will be reviewed by the Advisory Committee in Ireland, assisted
by the staff of The American Ireland Fund, to determine
whether the recommendation is consistent with the current
charitable goals of The American Ireland Fund. Board Action:
At regularly scheduled Board meetings the Board will consider
such staff reports and Advisory Committee recommendations,
and may make grants from the relevant Advised Funds in accordance
with the normal Board grant-making procedures. The Executive
Committee of the Board may act for it in all matters in
accordance with authority delegated to such Executive Committee.
4.5
Notification To Grantee As To Source Of Distribution: Any
distribution from an Advised Fund, unless otherwise requested
by the Donor of the Advised Fund, shall identify the name
if the Advised Fund from which the distribution is made.
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Please note that while every effort
is made to ensure this information is correct, you should check
with an Ireland Funds' associate who will be delighted to help you.
Thank you. |
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