Roundtable Submits Comment Letter on Proposed Rules for Donor-Advised Funds

With generous Americans increasingly giving back through flexible vehicles like donor-advised funds (DAFs), pressure is building to add new restrictions on these charitable giving accounts.   

In November, the Treasury Department and IRS issued a notice of proposed rulemaking, implementing provisions of the 2006 Pension Protection Act. As the proposed rules relate to donor-advised funds, specifically key definitions and clarifications, the Roundtable is closely monitoring the new rules and submitted a comment letter on February 15 that outlines our concerns. Here, Philanthropy Roundtable again stresses the value of DAFs as a vehicle for robust giving and urges regulators to reconsider three aspects of the proposed rule: 

  1. The proposed short implementation timeline that may be virtually impossible for some DAFs to meet. 
  2. The unintended consequences of proposed changes to how investment advisors may assist clients with their DAFs, potentially discouraging investment advisors from recommending DAFs to their clients. 
  3. The negative implications of overly broad definitions of distributions that appear to penalize necessary expenses such as legal counsel or accounting related to a DAFs operation. 

Philanthropy Roundtable believes new rules and restrictions on how Americans can give to the causes and communities they care about will chill charitable giving and must be carefully examined. These additional rules proposed by the Treasury and IRS may impose significant restraints on DAFs and make it harder for charities to meet the public support test. Now is the time to ensure rules foster giving.  

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