Philanthropy is a cornerstone of life for many, affording the opportunity to dedicate time and resources to support and shape their world.
Chuck Feeney, co-founder of retail giant Duty-Free Shoppers is an extreme example of this. Feeney spent 38 years giving away his entire fortune. When asked about his philanthropic habits he answered, “I believe strongly in giving while living.” Years ago, he set aside $2 million for retirement and then proceeded to donate more than $8 billion dollars to charity. Last month he made his final bequest.
Mr. Feeney’s experience demonstrates that having a clear plan and an efficient mechanism for charitable giving can greatly enhance the impact of one's gifts. Not everyone has the resources to establish their own foundation, so many in the US and other jurisdictions use donor-advised funds (DAFs) to plan and implement effective charitable giving in a tax-efficient manner.
A DAF is a recognized philanthropic entity established to manage and administer contributions to other charitable organizations. In the US, such funds date back to the Great Depression, The Jewish Communal Fund was founded in 1972, and many financial firms have since launched similar funds as a resource for their clients.
In recent years, Israeli philanthropic activity has grown dramatically, both in its scope and sophistication. With the help of the Jewish Funders Network and new tax regulations recognizing DAFs, philanthropy in Israel is getting a boost with the recent launch of the Keshet Donor Advised Fund, Israel’s first DAF.
A notable benefit associated with DAFs is the ability to separate the timing of a tax-recognized contribution from its disbursement to the ultimate charitable beneficiary. In a year, when income is high, a larger contribution can be made to the DAF, with an immediate tax benefit for the entire amount. The donor can then make informed donation decisions free of time constraints.
Keshet’s tax standing, experience and efficiency should enable it to dramatically increase the scale and impact of philanthropy in Israel. Aside from being a resource for local philanthropists, Keshet also provides a simple and effective gateway for foreign supporters of Israeli causes. To date, two large US foundations have shared their plans to direct their Israel activities through Keshet, anticipating that Keshet’s staff will greatly enhance the efficiency and reach of their philanthropic activities in Israel.
This is an exciting development for philanthropy in Israel, and we’re eager to watch Keshet’s progress. Let us know if you’d like more information or contact Keshet directly at info@keshet-il.org or +972-9-953-3895.
Disclaimer
The information contained in this article has been provided for information purposes only. It does not constitute any form of advice nor recommendation to buy or sell any securities or to adopt any investment or tax strategy mentioned therein. It is intended only to provide observations and views of the author(s) at the time of writing, both of which are subject to change at any time without prior notice. The information contained herein is derived from sources deemed by MaimonWealth to be reliable but its accuracy and completeness cannot be guaranteed. This material does not have regard to specific investment objectives, financial situation, tax situation or the particular needs of any specific person who may read it. Any views regarding future prospects may or may not be realized. Past performance is no guarantee of future results.