Collective Giving Funds
An FJC Collective Giving Fund (CGA) is a charitable vehicle that can be established by individuals, families, organizations or small groups that want to raise funds as a group, or from multiple individuals and foundations for the purpose of supporting charitable organizations. Funds are often established in memory of a loved one, by a group of alumni, or a group of like-minded individuals who want to pool their assets together to distribute grants to organizations.
Collective Giving Funds give groups the opportunity to pool together their resources in support of organizations or causes. Since the CGA is managed by FJC, participants can concentrate on their goals for the collective, without having to worry about the administrative oversight or tax burdens of an independent organization. FJC solves these problems by accepting tax-deductible donations designated for the CGA, providing tax receipts to donors, managing the funds maintained in the account, and completing all due diligence on grant distributions. The founders benefit from the ongoing professional oversight offered by FJC and our infrastructure such as allowing for the use of credit cards. The CGA is owned, controlled, and managed by FJC, but the account’s Advisors have privileges with respect to investments and distributions of funds from the account.
Establishing a Collective Giving Fund
How the Collective Giving Fund Works
Once the Advisors on the account have been selected and they have completed the Collective Giving Fund Letter Agreement and Application, the CGA is ready to start receiving donations. Contributions of stock, or other appreciated assets held for one year or more, avoid capital gains tax on the appreciation. Funds received by FJC for a CGA are invested based on the account’s Investment Allocation and are available for distribution at any time. The investment income earned on the account helps defray the modest administrative fees charged to cover program costs.
Individuals, corporations and other foundations are free to make contributions to the account at any time. There is no minimum amount for contributions. All donors will receive a tax receipt from FJC for their contribution per Federal requirements.
Account Advisors may recommend an unlimited number of grants, for a minimum of $100 each, to qualified U.S. public charities or, through FJC’s Grant Assistance Program, to certain other qualified domestic and overseas charities and projects. All grant checks can identify the name of the fund or be sent anonymously and are accompanied by a letter that includes the name of the fund and the Advisor that recommended the grant, as well as any special restrictions or instructions requested by the Advisor. Account Advisors may submit grant recommendations via the FJC Account Portal, email, fax, or postal mail at any time.
Advisors on the account may view the account activity online at any time. They may also recommend a reallocation of the account’s investments three times each calendar year, allowing for all contributions to be maximized to the fullest extent. All Advisors, and other authorized account representatives, can receive a Quarterly Statement of Activity for the account.
All contributions received on behalf of the account will be subject to a modest transactional fee of 2%; the balance of the contributions received is applied to the account. There is also an annual fee of 1% of the average daily balance maintained in the account. This fee is posted to the account quarterly at a rate of ¼ of 1%.
Advantages of a Collective Giving Fund:
Low Administrative Fees & Potential Investment Income
FJC is one of the few foundations offering Collective Giving Accounts to groups of individuals while maintaining among the lowest fees in the industry. In addition, FJC is one of the few organizations that offer the opportunity to select how the account balance is invested and earn income on the funds while they are held in the account. Any investment income earned on the account balance is applied to the account, which helps and often more than offsets the administrative fees. Surplus income generates more dollars for the fund!
Up-to-date Access to Your Account Information
Account Advisors can access your account balance, view past activity and previous Quarterly Statements of Activity on the FJC Account Portal. This will allow Advisors to see, who has contributed to the account, what distributions are in process, etc. If there is any additional information needed that is not available online, FJC will provide the information upon request.
Funds are Available for Distribution at Any Time
Account Advisors are free to submit distribution requests at any time. There is no minimum balance that must be achieved in the account before funds can be released, nor a maximum number of distributions that can be processed during a set period.
Large Selection of Contribution Formats for Donors
CGA Donors can send contributions in the form of checks, appreciated securities, via credit card or wire transfer, and other FJC pre-approved assets. Contributions of appreciated securities (including mutual funds) or other property, held for at least one year, are deductible at their full fair market value. Donors pay no capital gains tax on the appreciation.
No Establishing Contribution and Minimum Fees
FJC does not require an establishing gift for the setup of Collective Giving Funds. An Account may be opened with a zero balance and fees will only be assessed on the account once it starts receiving contributions.
FJC applies an administrative fee of 1% annually, based on the average daily balance of the account. Additionally, we apply a transactional fee on funds received, which is typically set for the agreement term at 2%, depending on the expected volume of contributions and distributions. Unlike many other community foundations, we do not charge an application fee, renewal fee or minimum balance fee.
FJC offers a special opportunity not available from most community foundations or donor advised funds. FJC can honor grant FJC offers a special opportunity not available from most community foundations or donor advised funds. FJC can honor grant recommendations to pre-approved overseas charities and domestic organizations that have not yet received their tax-exempt ruling. FJC will work with the recipient organization to complete our application, agreement and reporting requirements.
Quick and Easy Grant Procedures
FJC has a low minimum grant recommendation amount ($100) and typically processes grant recommendations within 10 business days. Please note: certain recommendations may require additional research, which will extend the processing time.
Advisors on the CGA may submit grant recommendations via email, online using the FJC Account Portal, or in writing on a customized Grant Recommendation Form that is sent in by postal mail or fax. Please note: we cannot accept recommendations over the phone.
FJC Gift Certificate Program
You may request FJC Gift Certificates, for $100 or more. Recipients of the certificate can then recommend a distribution to the qualified charity of their choice.
Tips About Grantmaking
You may recommend grants to any qualified tax-exempt organization, or qualified religious institution, in good standing with the IRS. Distributions can also be made to international charities that meet due diligence requirements and are approved by FJC for distributions on an agreement and reporting basis.
You may recommend any number of grants from your Fund during the year. The only requirement is that each grant recommendation is for a minimum of $100 and you have enough funds in your account to honor the recommendation at the time it is submitted.
FJC will contact you if your recommendation does not meet the minimum amount, if there are insufficient funds in your account, or if FJC has any other questions or concerns regarding your recommendation.
Please note that we ask you to allow 10 business days to process eligible requests, but we generally process requests within about a week.
FJC cannot honor the following recommendations from your Fund:
Pledges- FJC cannot honor pledges that you have made to an organization. This is a personal obligation that you have entered into and cannot be honored through your FJC Donor Advised Fund. FJC can honor solicitation requests.
Tuition - No form of tuition, or the enrollment fees for extracurricular activities, can be paid from your Fund. If a distribution to a school is submitted without a specific designation, FJC will confirm with the school, in writing, that the funds received will not be applied to the tuition of any particular individual.
Gift Intended for the Benefit of One Named Individual - FJC cannot honor recommendations for gifts that will benefit one named individual. For example, “Please apply this gift towards the tuition of John Smith.”
Gifts, however, can be designated for funds being raised by a particular individual for an event. For example, “This gift is designated for Jane Smith’s participation in the Race for a Cure.”
Bifurcated grants - like all other donor advised funds, FJC will not distribute funds for the tax-deductible portion of a dinner ticket to, for example, a fundraising gala.
If you are not sure if a gift qualifies for distribution from your FJC Collective Giving Fund, please contact our office for clarification.