Concept · Tax in investing
What is a donor-advised fund?
Direct answer A charitable account run by a sponsoring charity. You contribute assets, take the full deduction in that year, and recommend grants to charities over later years. Contributing appreciated stock held more than a year deducts its market value with no gain recognized, which makes it the standard way to give low-basis shares.
Two 2026 rules make bunching through a donor-advised fund more useful: the first 0.5% of income given each year earns no deduction, and top-bracket deductions are cut by 2/37. Several years of giving in one contribution of the lowest-basis lots clears the floor once. Read the lever worth the most is never selling.
Sources
- IRS, donor-advised fundsirs.gov
- IRC §170(b)(1)(C), 30% limit on gifts of appreciated propertylaw.cornell.edu
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