Waqfi DAF by Azzad Asset Management
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The Azzad Donor Advised Funds
Azzad Traditional Donor Advised Fund (DAF)
A donor advised fund is a tax-smart way to give to charity. When you contribute cash or securities, you are eligible to take an immediate tax deduction.
Those funds will be invested in a halal separately managed account for tax-free growth. You can log into your account online to recommend grants to any eligible IRS-qualified public charity either now or over time. You are also able to make grants from both the principal and investment growth.
The minimum opening balance is $5,000.
Azzad Waqfi DAF: An Enduring Endowment
The Azzad Waqfi DAF is similar in setup to a traditional DAF but is also an inalienable charitable endowment where assets are dedicated permanently for charitable purposes.
The Waqfi DAF preserves principal and distributes only income towards a charitable purpose. The funds will be invested in a halal separately managed account. It is intended to continue in perpetuity and continue the charitable intent of the grantor.
The minimum opening balance is $25,000.
Aim to make a greater charitable impact while optimizing your tax benefits through a donor advised fund aligned with waqf principles. Waqfi DAF makes creating a waqf more accessible and easier to offer donor advised accounts that honor both modern philanthropy and Islamic traditions.
- Give cash, stocks, and more to qualify for an immediate tax deduction.
- Invest in halal investment allocations for potential tax-free growth.
- Recommend grants to your favorite charities over time.
- Minimum $5,000 to open, no ongoing balance required.
Is a donor advised fund right for me? Use this chart to find out.
Differences Between DAF and Waqfi DAF
| DAF | Waqfi DAF | ||
| Immediate Tax Deduction | Contributions are tax-deductible in the year they are made. | YES | YES |
| Tax Efficiency | Avoid capital gains taxes by contributing appreciated assets. | YES | YES |
| Legacy Planning | Involve family members in philanthropic decisions for lasting impact. | YES | YES |
| Investment Options | Various investment options to grow contributions over time. | YES | YES |
| Spending Policy | Calculated Annually | NO | YES |
| Preservation of Principal | Only Income is distributed and principal is preserved | NO | YES |
| Minimum Opening Balance | Amount to get started | $5,000 | $25,000 |
| Preservation of Donor Intent | Restricted to charities that meet the grantor’s original intent | NO | YES |
| Perpetual Duration | Designed for generations | NO | YES |
Frequently asked questions
What is an Azzad Waqfi Donor-Advised Account?
The Azzad Waqfi DAF is a donor advised fund. It is a tax-smart way to give to charity. Those funds will be invested in halal separately managed accounts for tax-free growth. You can log into your account online to recommend grants to any eligible IRS-qualified public charity either now or over time.
What is included in Azzad’s Philanthropic Advisory Services?
As your advisor, we’ll explore options for giving strategies that work for you including foundations, charitable trusts, qualified charitable distributions from retirement accounts, or even donor-advised funds. By analyzing your unique situation, we can help you identify opportunities and model outcomes to optimize the impact of your gifts while minimizing taxes. Alongside your annual purification statement, you’ll also receive the zakat amounts you owe on the investments we manage for you.
Do I need to have an existing Azzad relationship to open an Azzad Waqfi DAF?
No, anyone can open an Azzad Waqfi DAF or an Azzad Traditional DAF.
Do you work with non-profit organizations?
Yes! We can help you design and implement a comprehensive investment strategy that aligns with your mission and meets operational needs. We can also guide donors toward smart giving options that benefit your organization and mission.
What does ‘Waqfi’ mean?
Waqfi is an Arabic term meaning ‘My Waqf’. ‘Waqf’ is a specialized endowment that preserves principal and distributes only income towards a charitable purpose. It is intended to continue in perpetuity and continue the charitable intent of the grantor.
How will I know how much income I should spend each year?
An annual distribution statement will be uploaded to the donor portal each year to let you know how much income you should distribute that year to charities. In order to allow time for income accumulation in the Waqf, there will be no distribution in the first 3 years.
What if I want to give more or less than the annual distribution amount?
It is important to follow the distribution amount in order to maintain the sanctity of the Waqf terms. Otherwise, we recommend you open a regular DAF account.
How will WAQFI DAF be invested? Is it different than the options available for a regular DAF?
Yes, Waqfi DAF accounts will use an investment strategy designed to generate income and maintain the assets in perpetuity.
Investing involves risk, including possible loss of principal. You are strongly advised to consult with an attorney or tax professional regarding your specific legal or tax situation before opening an account. The tax information provided on this website is general and educational and should not be construed as legal or tax advice. Tax laws and regulations are complex and are subject to change; changes may have a material impact on tax results.
