DAF Donations

Michael Catrino · May 26

Hi, I was wondering how everyone here gives credit to donors for gifts from their donor-advised fund? Currently, I place the check from the donor-advised fund under their record. However, my supervisor has recently learned that many organizations around the country are giving the company who provided the donor-advised fund the hard credit for the check and then soft crediting the donor. My issue with this is that I’m afraid it will make it more difficult to track our donors’ giving to us in queries. How has everyone else handled these checks? Thanks.

Carlene Johnson · May 26

Michael — these are excellent questions to be asking.

There are a few different schools of thought on this, and the most important thing is that your organization develops a policy, documents it, and applies it consistently.

One resource that you may find helpful is @Bill Connors' bbcon presentation from a few years back. Tagging him here so he can share any updated perspectives.

In my own work, I’ve used both models:
• hard crediting the donor and soft crediting the DAF, and
• hard crediting the DAF and soft crediting the donors.
There are pros and cons to each approach.

Generally speaking, my preference is to hard credit the donor, soft credit the DAF, and then use gift subtypes, gift codes, or attributes to ensure I can report accurately on DAF giving while still receipting and acknowledging appropriately.

Since you’re currently hard crediting the donor, my recommendation — without knowing more about your internal reporting needs — would be to continue with that model and make sure you’re soft crediting and/or using subtypes, gift codes, or attributes to capture any additional information required for reporting.

Joe Moretti · May 26

We hard credit the DAVF, since that is where the check is coming from and so does our accounting department and then we soft credit the donor/person. We make sure all of our DAVF's have a code of Donor Advisor Fund. We have a attribute code called Source Code, since we track where the first gift came from, donation, event, Donor Advised Fund, etc. To make sure the donor/person pulls in queries, we choose CREDIT SOFT CREDITS TO BOTH and then include in the filter, source code does not equal Donor Advised Fund. The key is to make sure your Donor Advised Funds are coded as that. You can also exclude these in RE Mail, etc. This all works good for us and we have never had an issue.

brenda rufo · May 27

Hi! We enter the gift on the donor record and use 'other' as the gift type. Gift type 'other' is only used for DAF gifts. We add an attribute to this gift record with the DAF Company details. We created a gift attribute and under Category section we called this 'alternate payment'. The description section is a table where you can choose or add the DAF company name. This way we only have one record of the donation. We can find the DAF company with an easy query. You could also enter the specific fund name in the comments section. I hope this helps.

Tioga Anderson · May 27

DAF account has own record, linked via relationship to the sponsoring org (the legal donor), and the advisor (the real donor). Allows for automatic soft credit to advisor(s), assigning fundraisers, make the advisor(s) a contact for proper acknowledging, etc.

A million ways to skin this cat. If I was starting from scratch, I would just hard credit the donor and do what Carlene describes. Though the way I currently run is a close second.

Jeannie Goings · May 27

I recommend that you take the course of least disruption. Since your practice is crediting the donor, I'd stay the course and leverage attributes as others have suggested. What you don't what to do is swing the other direction and have a reporting period where gifts before this date were credited to the donor and gifts after were credited to the DAF. This makes for labor intensive reporting for five-ish years depending on how many years your board/annual/monthly reports include. And if the person who understand how to do the reporting leaves and there is no succession plan with the institutional knowledge to generate the reports, you will find yourself with a staffing issue as nobody will want to stay in the role for long.

Bill Connors · May 27

Since Carlene tagged me, some notes in addition to what my bbcon presentation says:

I don't recommend creating a constituent record for the DAF in any situation. The DAF is just an account at a Foundation. Maybe a constituent record for the Foundation, but the DAF itself does not need a constituent record IMHO.
I actually prefer to hard credit the legal donor and soft credit others. HOWEVER, the worst feature of RE IMHO is Soft Credit output and many, many folks have had problems using RE when data entry has been done that way. Thus the ideas in the presentation that Carlene linked to to HC the "real donor." the person, and maybe soft credit the foundation. We need to use RE how we can get it work for us, not be forced into artificial guidelines that don't actually work with the software we have.
Consistency is perhaps the most important. Don't suddenly change your procedures on this topic without thinking through long and hard how it affects the past gifts and how you're going to pull outputs (queries, reports, dashboards, etc.) with data entered both ways — and it's not easy to flip flop the hard and soft credits for previous gifts no matter which way you did it before.

This is one of the hardest topics I consult with clients on, thus my point it's the worst feature of RE today. So be patient and thoughtful, it's not an easy topic.

DAF Donations

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