DAFs Continue Torrid Pace

Contributions to donor-advised funds (DAF) reached another all-time high in 2017 and charitable assets in DAFs eclipsed $100 billion for the first time ever, according to a new report.

The “2018 Donor-Advised Fund Report,” by the National Philanthropic Trust (NPT), indicated that contributions to DAFs totaled $29.23 billion, up 16.5 percent from 2016, and grant recommendations to qualified charities resulted in $19.08 billion, an increase of 19.9 percent. Charitable assets in DAFs totaled $110.01 billion in 2017, exceeding $100 billion for the first time.

The compound annual growth rate of contributions from 2012 through 2016 was 15.7 percent. The compound annual growth rate of charitable assets in DAFs for that same period was 17.9 percent.

Grants from DAFs to qualified charities jumped almost 20 percent from 2016 to 2017, the fastest rate of growth than almost every year since the NPT began the study in 2007.

Contributions to DAFs as a percentage of total individual giving continued to grow last year, jumping to 10.2 percent in 2017, up from 9.2 percent in 2016. It’s the seventh consecutive year the figure has increased, from 4.4 percent in 2010.

The 2018 report is based on data collected during the second and third quarters of 2018 for DAFs and charities for fiscal year 2017, which for some organizations begins as early as July 2016 and ends as late as December 2017. The 18-month period, the report noted, included a presidential election cycle, Congressional tax reform, and major humanitarian crises, including devastating hurricanes in the U.S and Caribbean.

The report analyzes data from 1,002 charitable sponsors and includes additional data from audited financial statements, annual reports, organizational websites and news releases.

Other highlights of the report included:

  • The number of individual DAFs increased by 60.1 percent to 463,622;
  • Grant payout remained above 20 percent, at 22.1 percent;
  • The average size of an individual DAF was estimated to be $237,280 in 2017, a decrease of 20.5 percent compared to the revised estimate for 2016, which was $298,628;
  • Every U.S. state, two territories and the District of Columbia has DAF charitable sponsors. There are five states with more than 50 such sponsors – California (at least 90); New York (at least 59); Ohio (at least 59), Indiana (at least 58) and Pennsylvania (at least 58).
  • The average DAF at national charities in 2017 was estimated to be $173,241, a decrease of 35.6 percent compared to 2016.
  • The number of individual DAFs at community foundations increased 0.1 percent to 70,215 compared to 2016.
  • The number of individual DAFs at single-issue charities increased 6.1 percent to 55,266 compared to 2016.

The NPT began tracking donor-advised fund data in 2007. Since then, it has analyzed a total of 1,071 charities including 61 national charities, 620 community foundations, and 390 single-issue charities. The NPT compares its data against all charities that complete an Internal Revenue Service (IRS) Form 990 Schedule D, which relates to donor-advised funds.

Founded in 1996, the Jenkintown, Pa.-based NPT is an independent public charity that specializes in “tailored philanthropic solutions” for individuals, families, companies, and foundations.