No Regulations Needed On Donor Advised Funds

Donor advised funds allow you to get an immediate tax deduction on the funds you put into the charity account and then make a donation to a nonprofit organization when you choose to. These funds are becoming more popular. Last year, such funds held 12% more than they did in 2009, holding up to almost $30 billion in assets.

The National Philanthropic Trust conducted a study that showed donor-advised funds contributed 17% of their assets to charitable causes in 2010. The Obama administration and a key republican lawmaker have debated over whether regulations should be put on these funds so that people do not just stockpile funds to get a tax break. A recent treasury department debate concluded that no regulations were needed because donors were giving enough money away.

See Noelle Barton, Donor-Advised Fund Grants Inch Up in 2010, Journal of Philanthropy, Dec. 20, 2011. 

Special thanks to Jim Hillhouse (WealthCounsel) for bringing this article to my attention.