Donor-advised funds (DAFs) continued to increase last year, increasing 25 percent from 2013 according to a new report from Schwab Charitable.
According to the San Francisco, Calif.-based financial firm, $928 million in grants went to charities on behalf of donors in 2013, with more than 48,000 nonprofits receiving these gifts. Among the most widely supported charities in 2014 the Schwab DAFs were Doctors Without Borders, Wounded Warrior Project, The Salvation Army, and local public radio and television stations.
Health & human services organizations received the greatest amount of support from DAF holders at 29 percent, with religious institutions getting the second-greatest amount of grants at 24 percent. International/foreign affairs received the least percentage of grants at 4 percent.
Schwab Charitable has made approximately $5 billion in grants to 91,000 charities on behalf of its donors during its 15-year existence.
”I am so grateful to our donors for their extraordinary generosity in 2014,” says Kim Laughton, president of Schwab Charitable. “We continue to look for ways to encourage them to set aside more money for charity by making giving simple, tax-smart and flexible.”
In 2014, 71% of contributions into Schwab Charitable donor-advised fund accounts were appreciated investments or assets, such as public company stock, real estate or private business interests. The reason for this lies in the fact that donors who contribute appreciated assets held for more than a year directly to public charities can generally claim the full fair market value as a charitable contribution and will not owe capital gains tax on the sale of the assets. This can result in donors having up to 20 percent more to give than if they sold the asset first and then gave the cash proceeds to charity.
The increase in grants from last year might have been partially due to the launch of Schwab’s mobile app which allows DAF holders to make grants from their mobile devices. “We can’t imagine a better way to celebrate our 15th anniversary than with a strong start to the giving season,” said Laughton at the time of the app’s launch. “Our donors are increasing their level of support at a much greater pace than those who do not use a donor-advised fund. They have the flexibility to recommend grants from virtually anywhere with their mobile devices.”
According to Laughton, Schwab is still on track to distribute $1 billion in grants by June 2015, a number that was first mentioned in a report last year by The NonProfit Times.