I'm proud to join a coalition of philanthropists and foundations to announce an effort to accelerate charitable giving. The effort calls for common-sense tax reforms to help increase the amount and flow of resources to charities. Short thread on the issues and our proposals. 1/

Private foundations (PFs) and donor advised funds (DAFs) are important vehicles to support giving. But asset aggregation in these vehicles is not enough. Our tax laws should ensure these dollars get distributed to the community in a timely manner. Today they don't. 2/

Moving money to a DAF is a tax strategy, not philanthropy. Distributing the money from a DAF to nonprofit orgs that support the community is when it becomes a charitable act.

Tax law should encourage both actions, not just the former.
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There's a growing disconnect between growth of funds in tax-free accounts and $ given to working charities. These vehicles are not an end to themselves. They exist to support the community. We propose 3 reforms to ensure the sector prioritizes charities over asset aggregation. 4/

First, DAFs must fulfill their charitable purpose. Donors to DAFs get a tax benefit today but there are no gov't incentives or requirements to ever distribute the $ to the community. DAFs should be time-limited to 15 years or the tax benefit is delayed until $ is distributed. 5/

Second, while PFs have a 5% distribution requirement, there are loopholes that should be closed. Family member travel and salaries should not count as part of the 5%. Distributions from PFs to DAFs should not count. And there should be incentives for quicker distributions. 6/

Last, the tax code should encourage giving at all levels. A broad set of donors strengthens society. While a majority give to charity, almost 90% receive no tax benefit. Congress should expand the tax deduction to smartly increase the amount of giving and # of donors. 7/

As we struggle with Covid19 & racial equality, we need a strong nonprofit sector now more than ever. The sector’s goal should not be to maximize assets in tax-free accounts; it must be to improve lives. As my philanthropic hero Chuck Feeney said, “The need is now. Why wait.” 8/

To learn more about the effort, please visit our website. We need a large and broad coalition to succeed. 9/9 https://acceleratecharitablegiving.org/new-coalition-of-philanthropists-major-foundations-launches-on-giving-tuesday-to-increase-funding-to-americas-charities-during-pandemic-and-beyond/