Gifts to Vanguard Charitable Rose 16% Last Year

Contributions to donor-advised funds at Vanguard Charitable rose 16 percent last year, to $1.6 billion, the organization said Wednesday.

Vanguard also added roughly 3,300 accounts last year, a more than 22 percent spike compared with 2016.

Much of the growth is likely due to passage of the tax-overhaul bill last year, which caused many people to change their philanthropic plans because of potential tax implications, says Jane Greenfield, president of Vanguard Charitable, which raises more from private sources than all but nine other nonprofits, according to the Chronicle’s latest Philanthropy 400 ranking.

Donor-advised funds allow people to set aside money for philanthropy, take an immediate tax deduction, and later decide which charities will receive grants.

During the holiday season, donor-advised funds became popular for people who wanted to take advantage of 2017’s deduction rules but didn’t know which nonprofits they wanted to support.

Other donor-advised-fund providers have also reported big spikes in contributions and new accounts last year over 2016.

A strong stock market near the end of the year also contributed to the spike. Some 80 percent of contributions made to Vanguard accounts in December were donations of appreciated assets, Greenfield says.

Grants made from the accounts to charities also rose to $874 million, a 28 percent increase last year over 2016.

Some of that increase was probably for relief efforts following Hurricanes Irma, Harvey, and Maria, Greenfield says.

The “disasters caused people to recognize and remember that they have this donor-advised fund for a reason,” she says. “They have the flexibility not only to meet their long-terms plans of giving but also to be nimble.”