Growing your endowment fund at the Community Foundation of Dunn County is no doubt a top priority. Through your endowment fund, your donors have a meaningful opportunity to ensure that your mission stays strong for generations to come.
As always, the team at the Community Foundation is happy to be a sounding board on tricky issues like cryptocurrency so you don’t find yourself scrambling to answer donor questions.
Here’s what you and your board of directors need to know:
The high volatility of cryptocurrencies, coupled with regulatory uncertainty and cybersecurity risks, generally makes them an unsuitable investment for charities’ endowments, and that is certainly the case for your endowment fund at the Community Foundation. Indeed, the Community Foundation and its board of directors takes seriously the fiduciary responsibility to manage funds prudently, and the speculative nature of crypto investments could jeopardize your organization’s financial stability.
At the same time, your fundraising team may wish to actively encourage cryptocurrency donations to your endowment fund. Notably:
–Even across the globe, the average crypto donation is significantly larger than traditional gifts, sometimes up to five times the size.
–Accepting crypto donations allows nonprofits to tap into a new demographic of donors who are typically younger, forward-thinking, and tech-savvy individuals–who are often quite affluent.
–Don’t overlook the potentially compelling tax benefits for crypto donors. Because the IRS treats cryptocurrency as property, donors may be able to avoid capital gains tax and benefit from a favorable income tax deduction when they donate appreciated crypto assets.
The Community Foundation can help you work through the sometimes tricky process of accepting cryptocurrency gifts into your endowment fund, including what types of gifts the fund will accept, how long the fund will hold the asset, and completing all the technical steps required for a cryptocurrency transfer by leveraging the services of a qualified intermediary. Please reach out anytime to learn how your organization’s endowment can grow by appropriately embracing cryptocurrency donations.
Phone: 715-232-8019
Email: info@cfdunncounty.org