Please note that the DAFpay feature is only available to organizations using Neon Pay as their payment processor.
Contact us at clientaccountspecialist@neonone.com to discuss switching to Neon Pay.
DAF Overview
A Donor-Advised Fund, or DAF, is a charitable giving account that allows individuals to donate assets such as cash, stocks, or non-publicly traded assets.
Donors contribute to the DAF for an immediate tax deduction and then have the flexibility to direct the funds to various charitable organizations over time. However, DAFs can only be used for fully tax-deductible contributions, such as donations, gifts, and grants. Today, there are over $230 billion in DAFs which is a massive opportunity for nonprofits. These funds often involve substantial amounts of money, usually in the thousands of dollars or more.
Constituents with DAFs have already made the intentional choice to generously give to charitable causes.
Chariot Overview
Chariot is a tool designed to enhance donation forms by adding a payment method branded as DAFpay. It functions similarly to payment options like Apple Pay or Google Pay, where donors see the DAFpay option during the checkout process on a donation form. Chariot integrates with various DAF providers, allowing Advisors to log into their DAF accounts and direct funds to charities seamlessly. By doing so, Chariot simplifies the donation process for Advisors, enabling them to easily access and utilize their DAF funds.
By enrolling in DAFpay by Chariot and Neon Pay, DAF funds, termed "distributions" in Neon Pay, are automatically captured in the Neon Pay platform alongside credit card charges and echecks. This allows easier money management because all of the funds are located in one convenient location. Additionally, depending on the merchant's Neon application, the funds can be counted towards donor's profiles, campaigns, and more. By using Chariot, clients will no longer need to import integrated DAF distributions as offline transactions or manage them in a separate system.
DAFpay in Neon CRM - How do I get started?
1. Enroll in DAFpay
Starting December 16, 2024, Neon CRM + Neon Pay users can enroll their organizations in DAFpay. For detailed instructions about completing the enrollment process in Neon Pay on or after December 16, click here.
2. Add DAFpay to your Neon CRM donation forms
Once enrolled, your Neon CRM Donation Forms (excluding Legacy Forms) will have the option to activate the DAFpay payment method.
When Creating New Forms
When you are creating new donation forms in your Neon CRM, go to Forms & Pages > Forms > New Form > Donation. In the donation form setup step, DAFpay will be automatically turned on inside the "Select your payment options" section, but can be turned off for forms where you do not want to make DAFpay available. Please note: DAFpay is not available for recurring donations, so when testing forms be sure to test one-time payments in order to see the DAFpay option.
When Editing Existing Forms
After enrolling in DAFpay, you may want to add the DAFpay option to forms currently published and linked to your website/emails/etc. Go to Forms & Pages > Forms > select "Edit Donation Form" in the "..." action menu next to each form you want to edit.
Inside the Form Builder, go to the cog wheel "Settings" button (at the bottom of the options on the left edge of your screen). Scroll down and open the "Payment Settings" section, then click to add DAFpay. Before leaving this page, be sure to click "Publish Changes" at the top right. Please note: DAFpay is not available for recurring donations, so when testing forms be sure to test one-time payments in order to see the DAFpay option.
How will my donation forms work when DAFpay is turned on?
When DAFpay is turned on for a specific donation form, the DAFpay payment method appears automatically on the checkout page of your forms. Please note: DAFpay cannot be included on membership, event, or store forms. Additionally, DAFpay will be hidden if the donor has elected to create a recurring donation.
When constituents click the button for DAFpay, Chariot takes over via a pop-up on the form. After the Chariot steps are completed, the form is submitted and your constituent will receive a follow-up email from Chariot with next steps.
Many DAF providers, such as the Fidelity Charitable example shown here, are integrated with Chariot. Integrated DAFs are submitted automatically to the DAF provider by Chariot, simplifying the process for your donor and speeding up the process for funds to get to your organization.
However, if the constituent’s DAF provider is not an integrated partner with Chariot, they can still fill out the DAFpay form to indicate their intent to recommend your organization to receive a grant from their DAF. For non-integrated DAFs, the donor will need to take additional steps to recommend your organization for funding. This information is included in the exit message after they complete the donation form.
How are DAFpay payments tracked and managed in Neon CRM and Neon Pay?
The status of all DAFpay grants is tracked in Neon Pay's DAF Manager. For details, click here.
In Neon CRM, the DAFpay distribution will be entered into your Neon CRM as a pledge record on the DAF distributor's account, with your constituent's information entered into the "DAF Advisor" fields on the pledge record (see the "DAFpay Information" section in the image below).
When the funds are received from the DAF Distributor, click on the Charge ID (or log directly in to Neon Pay) to mark the DAFpay transaction as "completed" in Neon Pay.
To do this, on the page for the DAF distribution, click "Change Status", then select "Completed" and "Update Distributions."
At this point, the pledge in Neon CRM is closed and the individual donor automatically receives a soft credit.
The pledge will look like this - note the Balance has adjusted to $0.
And the pledge payment will look like this - note the soft credit.
Neon CRM will also automatically trigger the Soft Credit Recipient system email and/or letter, if those communications are active in your CRM. To learn more about system emails and letters and set up unique emails/letters for DAFpay soft credit recipients, start with our System Emails guide and/or System Letters guide.
Fees
DAFpay transactions have a processing fee of 4.99%. However, your constituents have the option to cover the fees by bumping up the total amount of their distribution. Please note: Donor Covered Fees will round up to the nearest dollar when attached to a DAFpay transaction. This is because the majority of DAF Distributors will not honor distribution requests that aren't a whole number.
If your constituent chooses to cover the fees for a DAFpay transaction, the fees will always be added to the total amount of the donation, regardless of your setting inside Global Settings > Donor Covered Fees. DAFpay Distributions will always combine the donation amount and fee coverage amount into a single pledge record, for tracking with Chariot and the DAF Distributor. After the distribution is received, a system user can split the pledge payment to track fee coverage in a separate Campaign, as needed.
You will receive the DAFpay distribution directly from the DAF Distributor via check or EFT. Please be sure to set up your account with Chariot in order to route distributions correctly. You will receive Chariot account instructions after enrolling for DAFpay inside Neon Pay.
Fees will be invoiced to your organization by Chariot.
Example
For example, if Jane Doe is your organization's supporter, and she is advising her Fidelity Charitable DAF to make a distribution to your organization:
1. Neon CRM will create a pledge record on the Fidelity Charitable Fund's company account inside the CRM. If Fidelity did not previously have an account in your CRM, an account will be created.
2. Jane Doe will be added to the "DAF Advisor" field inside the pledge record and an account will also be created for her, if she is a new constituent in your database.
3. When the distribution is received (typically by check), go into Neon Pay's DAF Manager and mark the grant as received.
4. Neon CRM will automatically add a pledge payment record, close the open pledge on Fidelity's account, and issue a soft credit to Jane Doe's individual account, to make sure her DAF giving counts towards her lifetime impact for your organization. At this point, Neon CRM will also send a Soft Credit Recipient Acknowledgement to Jane.
Frequently Asked Questions
Who is eligible to enroll in Chariot?
Only 501(c)3 in the United States in good standing with the IRS are eligible to receive DAF distributions via Chariot DAFpay.
What can DAFpay be used for?
DAF distributions can only be used for tax exempt payments where the advisor does not receive personal benefit from the payment. Chariot and Neon One recommend that your organization create a gift acceptance policy and include information on the acceptance of DAFs. Here’s a helpful resource.
How do DAFpay funds get to my organization?
Grants initiated via DAFpay will arrive via check or EFT directly from the DAF provider.
How many times do I need to enroll in Chariot?
Enrollment is at the EIN level. This means if your organization has multiple Neon Pay merchants for the same eligible EIN, you will not need to enroll more than once. If you have multiple merchants with unique, eligible EINs, you will need to enroll each EIN separately in order to see DAFpay on all of their payment forms.
Can my organization opt-out or turn off Chariot?
Yes. If you have not enrolled in Chariot, the DAFpay button will not appear on your forms. If your organization has already enrolled in Chariot and you want to remove the button from your forms, contact Neon CRM support for assistance.
Why does Neon CRM enter the pledge and payment on the DAF Distributor's account and not on the individual donor's account?
When an individual makes a contribution to their Donor Advised Fund, they are able to take a tax deduction immediately based on the contribution. Therefore, when a distribution is made from the DAF, the donation is not tax deductible to the individual. To track the accurately, Neon CRM attributes to donation to the distributor but adds a soft credit to make sure that your database accurately reflects the generosity of the individual who directed the distribution. Your constituent will receive a Soft Credit Acknowledgement and their giving will be included in the Generosity Indicator, on their account Soft Credits list, and in reports.
I want to use DAFpay for my year-end giving campaign? How quickly can I get set up and running?
The sign up process is straightforward and there's no delay after signup, so you can be up and running as early as December 16.
Are there processing fees for DAFpay? How are fees charged to my organization?
Yes, DAFpay transactions have a processing fee of 4.99%. However, your constituents have the option to cover the fees by bumping up the total amount of their distribution. Fees will be invoiced to your organization by Chariot.