Grants From Donor-Advised Funds Totaled $23.42 Billion in FY2018

Grants From Donor-Advised Funds Totaled $23.42 Billion in FY2018

Grants awarded from donor-advised funds in the United States in fiscal year 2018 totaled a record $23.42 billion, up 18.9 percent from the $19.7 billion awarded in 2017, a report from the National Philanthropic Trust finds.

Based on an analysis of data from IRS Form 990s filed by nearly a thousand DAF-sponsoring charitable organizations, including national charities, community foundations, and single-issue entities, the thirteenth edition of NPT's Donor-Advised Fund Report found that grantmaking by donor-advised funds to qualified charities nearly doubled over the past five years, from $12.35 billion in 2014 to $23.42 billion in 2018.

The report found that total DAF assets available for grantmaking increased 8.3 percent on a year-over-year basis in 2018, to an all-time high of $121.42 billion, while contributions to DAF accounts increased 20.1 percent, to a record $37.12 billion. The report also found that the number of DAF accounts in the United States jumped 55.2 percent, to 728,563, following a 60.2 percent jump in 2017; that the average amount held in a DAF account declined 30.2 percent, to $166,653, following a 20.5 percent drop in 2017; and that the average DAF payout rate in 2018 declined slightly, to 20.9 percent, from 22.8 percent in 2017. According to the report, the increase in the number of DAF accounts has been driven in large part by the introduction of DAF models that tend to have no minimums, hold existing balances in cash, and make smaller grants to charities.

The analysis also found that number of accounts at the fifty-four DAF-sponsoring national charities in the sample jumped 75 percent, to 593,356 in 2018, while their combined charitable assets grew 22.6 percent, to $72.35 billion, contributions increased 24.1 percent, to $23.38 billion, and grant dollars awarded jumped 26.8 percent to $13.1 billion; that the more than six hundred community foundations in the sample collectively administered 77,234 donor-advised funds with combined assets totaling $33.87 billion, that those funds saw year-over-year increases of 15.4 percent in contributions and 10.2 percent in grant dollars awarded; and that the more than three hundred and thirty single-issue charities in the sample administered 57,973 donor-advised fund accounts with combined assets totaling $15.19 billion, and that those funds saw increases of 11.7 percent in contributions and 10.3 percent in grant dollars in 2018.

"This is the first Donor-Advised Fund Report that fully captures donors' response to tax reform and its implications for charitable giving in December 2017, before the new laws were enacted," said National Philanthropic Trust president and CEO Eileen Heisman. "Contributions to donor-advised funds outpaced grants for the first time in four years, which may indicate donors choosing to 'bunch' their giving — essentially pre-funding several years of charitable giving to make their philanthropy more tax effective. We can't yet predict a definitive trendline, but it is clear DAFs are a philanthropic solution that many donors chose in response to the new tax laws. Donors created more individual DAF accounts than ever before and our report found record highs in every key metric."

"2019 Donor-Advised Fund Report: Grants to Charities Exceed $23 Billion as Total Charitable Assets Surpass $121 Billion." National Philanthropic Trust Press Release 11/12/2019. "2019 DAF Report." National Philanthropic Trust Report 11/12/2019.