Nothing motivates major donors faster that potential tax law changes. According to the National Philanthropic Trust, there has been a 72 percent hike in donor-advised contributions. Favorable market conditions and concern over changes to tax laws may be responsible for this dramatic shift.
Donor-advised funds are most likely to be held by high-net worth and ultra-high-net worth individuals. Fears of giving caps influenced major donors in 2016. What will happen in 2017? What type of tax policies will the new administration devise? Questions with answers waiting to be revealed.
It should be noted that the surge in donor-advised contributions did not translate to increased contributions from those funds to nonprofit organizations in 2016. Nonprofits actually saw a decrease in gifts from donor-advised funds. Organizations should find solace in the fact the money is there but the check has not been mailed. As tax-policies become law, 2017 will be an experimental year for giving practices.