Donor-advised funds are mushrooming. In 2012 the funds held more than $45 billion—up 19 percent from the previous year, according to a study from the National Philanthropic Trust. The number of accounts also went up about 7 percent, to 201,631. Their popularity is easy to understand: Many small donors appreciate having access to professionally managed philanthropic funds that still allow for donor choices, without the hassle and staff of an entire foundation. But legislation recently proposed in Congress could threaten the funds’ appeal. A draft tax-reform bill by Ways and Means Committee chairman Dave Camp (R-MI) requires donor-advised funds to give out contributions within five years of receiving them, or face a 20 percent excise tax. That significantly limits the strategic ability of donors to grow the value of their lifetime gifts before targeting them toward recipients. The rule would “effectively destroy the use of the donor-advised fund as a philanthropic platform and turn it into an enhanced charitable checkbook,” said Jeffrey Zysik of DonorsTrust during a recent webinar hosted by the Alliance for Charitable Reform. ACR, a project of The Philanthropy Roundtable, is currently working to educate lawmakers on the effects of this change. To follow its efforts, visit ACReform.com.