Sign up for our daily briefing

Make your busy days simpler with Axios AM/PM. Catch up on what's new and why it matters in just 5 minutes.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Denver news in your inbox

Catch up on the most important stories affecting your hometown with Axios Denver

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Des Moines news in your inbox

Catch up on the most important stories affecting your hometown with Axios Des Moines

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Minneapolis-St. Paul news in your inbox

Catch up on the most important stories affecting your hometown with Axios Twin Cities

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Tampa Bay news in your inbox

Catch up on the most important stories affecting your hometown with Axios Tampa Bay

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Charlotte news in your inbox

Catch up on the most important stories affecting your hometown with Axios Charlotte

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!
Expand chart
Data: National Philanthropic Trust; Chart: Axios Visuals

Billions of dollars are sitting in tax-free Donor-Advised Funds (DAFs) rather than going directly to charities, according to data from the National Philanthropic Trust.

What they are: A DAF "allows donors to make a charitable contribution, receive an immediate tax deduction and then recommend grants from the fund over time," the NPT explains.

  • "Donors can contribute to the fund as frequently as they like, and then recommend grants to their favorite charities whenever [it] makes sense for them."

Driving the news: The amount of money in DAFs keeps growing: 13% of all individual, charitable contributions now go into these funds, up from 4% in 2010.

  • It's too early to say, but DAFs could get a boost from President Trump's new tax code, allowing philanthropists to take an up-front tax break long before the money makes it to any specific cause.

Between the lines: Critics of DAFs see them as easy tax breaks for the wealthy with no enforcement mechanisms to ensure that money actually goes to charity.

  • In the short term, these funds may mostly benefit fund managers.
  • As of 2018, there was $121.42 billion sitting in DAFs.

On the other hand, the payout rate from DAFs to charities is more than 20% a year, according to NPT.

  • Last year, "grants from donor-advised funds to charitable organizations reached a new high at $23.42 billion," the group said in its report. "This is an 18.9 percent increase from a revised 2017 total of $19.70 billion."

What to watch: In an economic downturn, the funds waiting and growing in DAFs could provide a steady stream of money to charities that would otherwise suffer in a recession.

Go deeper:

Go deeper

Mike Allen, author of AM
2 hours ago - Politics & Policy

Biden's "overwhelming force" doctrine

President-elect Biden arrives to introduce his science team in Wilmington yesterday. Photo: Kevin Lamarque/Reuters

President-elect Biden has ordered up a shock-and-awe campaign for his first days in office to signal, as dramatically as possible, the radical shift coming to America and global affairs, his advisers tell us. 

The plan, Part 1 ... Biden, as detailed in a "First Ten Days" memo from incoming chief of staff Ron Klain, plans to unleash executive orders, federal powers and speeches to shift to a stark, national plan for "100 million shots" in three months.

Off the Rails

Episode 2: Barbarians at the Oval

Photo illustration: Sarah Grillo/Axios. Photo: Jim Watson/AFP/Getty Images

Beginning on election night 2020 and continuing through his final days in office, Donald Trump unraveled and dragged America with him, to the point that his followers sacked the U.S. Capitol with two weeks left in his term. This Axios series takes you inside the collapse of a president.

Episode 2: Trump stops buying what his professional staff are telling him, and increasingly turns to radical voices telling him what he wants to hear. Read episode 1.

President Trump plunked down in an armchair in the White House residence, still dressed from his golf game — navy fleece, black pants, white MAGA cap. It was Saturday, Nov. 7. The networks had just called the election for Joe Biden.

Fringe right plots new attacks out of sight

Illustration: Aïda Amer/Axios

Domestic extremists are using obscure and private corners of the internet to plot new attacks ahead of Inauguration Day. Their plans are also hidden in plain sight, buried in podcasts and online video platforms.

Why it matters: Because law enforcement was caught flat-footed during last week's Capitol siege, researchers and intelligence agencies are paying more attention to online threats that could turn into real-world violence.