From managing bank accounts, purchasing insurance policies to ordering fast food; Israelis conduct most of their daily activities digitally, but what happens to their donations? A new technological product in the field of philanthropy shakes the dust off the world of donations and offers advanced interfaces for managing and tracking donations, along with tools for realizing the maximum tax benefits. Nice to meet you – private and digital donation funds.

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What is a private donation fund?
A private donation fund is an innovative financial tool, which gives donors new options for increasing the impact and maximizing the tax benefits they deserve for donations. The model makes it possible to set aside an amount of money intended for donation in advance and thus qualify for the tax even before the money is actually donated. The model comes from the USA, where it is known as a Donor-Advised Fund (or DAF): the donor transfers funds to a fund managed by an association and he himself becomes an advisory body with the authority to decide on the destination of the donation.

In donation funds, the very deposit to the fund is already recognized as a donation, which gives donors a tax-recognized receipt for the entire amount, even before the actual donation is made
Stop chasing receipts
The financial model of a private donation fund changes the rules of the game in the world of philanthropy. The donation funds are managed by associations, which allows them to recognize the actual deposit to the fund as a donation and give the donors an immediate tax-recognized receipt for the entire amount of the deposit. After the deposit and the issuance of the receipt, the donors can donate the amount over time, in a strategic and considered manner, without bothering with the receipts.

To join the JGive donation fund at no cost >

Turn a donation into an investment
Because the funds are managed by an association, the donors enjoy all the tax benefits to which it is entitled. For example: you can invest the funds of the fund in the capital market and enjoy a full tax exemption on the profits – simply because associations are exempt from this tax. Another example of increasing your impact through tax benefits is donating shares. You can also deposit tradable shares into your donation fund without the need to pay capital gains tax (25%). This means that if you earned $10,000 on the shares you trade and chose to deposit them into your endowment fund – you will not pay any tax on the profits and the shares along with the $10,000 you earned will pass in their entirety. In this way, donors can increase their donation money by 25%, without paying more.

To join the JGive donation fund at no cost >
Keren Taromot is actually the only digital donation channel that allows making a donation in complete anonymity, for those interested
A new world of donations
The benefits of the fund are not limited to tax refunds. Separating the deposit stage from the donation creates a window of time in which you can choose the destination of the donations in a considered and strategic manner, examine the performance of the various associations and transfer donations in a one-time form or by standing order. In addition, you can consult with donation portfolio managers for the purpose of building a donation portfolio that matches your view. Another important advantage is the possibility to donate anonymously. Donors who prefer to donate anonymously discover that Keran Terumat is actually the only digital donation channel that allows them to do so in complete anonymity. The donor can choose not to display his name and the association receiving the donation will only see the name of the association in which the fund is managed, next to the amount donated.

For more details and an explanation of the model, click here >

How do you choose a donation fund?
Your donation money is your way of influencing reality, so it is important to make sure that it is managed in a reliable and safe place. Data that is important to pay attention to before joining:

Digital management versus manual management
Nowadays, you can manage a donation fund from anywhere, using your mobile phone. Ask to know if the fund you are considering joining allows digital registration and what actions you can perform on your own. Ask how deposits to and contributions from the account are made. Some places will allow you to perform all operations digitally and some will require you to deal with a representative. At JGive, the opening of the account, as well as the deposits and donations are made online, without the involvement of a third party and are available to you from anywhere in the world.

Minimum deposit total
Certain funds allow you to join only up to a certain deposit amount (usually tens of thousands of shekels). In JGive, for comparison, it is possible to open a fund without an initial minimum amount.

The payment model
Some associations charge the payment in the form of a management fee from the total funds managed in the account or in the form of a monthly payment. Generally, management fees decrease as the amount of money in the fund increases. The advantage of this payment mechanism is that usually 100% of the donation goes to the associations.

Another option for collecting payment comes in the form of a commission from the total donation. In this way, the donors benefit from free use of the fund and the association that manages the fund deducts from the total donation a certain percentage which is a participation in covering the fund’s operating expenses. In such cases, it is useful to find out what percentage of the donation actually goes to the associations.

The duration of the donation
The funds in the fund cannot stay there forever. Therefore, after the deposit to the fund, a donation must be made within a specified period of time. This period of time can range from one to five years and is usually affected by the amount of funds in the fund. Different bodies may grant different periods of time for donation and you should compare them.

The people behind the product
A donation fund is a financial body and as such, it is worth making sure that there are professionals behind it who supervise its activities. Donor funds are usually accompanied by committees that supervise the conduct of the donations and their transparency, as well as the execution of investments in the capital market and the transparency of the activity to the fund holders.
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Everyone deserves to contribute wisely
JGive is a non-profit association and the only organization in Israel that allows anyone to open a private donation fund with a click, without a minimum deposit amount. The associations, to which you can donate through the interface, are only registered associations with a proper management certificate, for which we do periodic proper inspections. Our website is a home for donors in Israel and to date over 1,000,000 donations have been made to organizations and associations promoting change in Israel.