Monday, March 17

"Donor advised funds" used to hide anonymous donors

Back in January, the Wall Street Journal argued that:

...nonprofits are coming under increased pressure to reveal the names of some of their most generous donors. Proponents of greater disclosure by charities, including some lawmakers and consumer groups, argue that keeping givers' identities secret can mask efforts by wealthy individuals and corporations to use philanthropy as a tool of undue influence.
I've also seen this increasing pressure in the political debates over whether the Clinton's should reveal anonymous donors to their Presidential Library. But there is more evidence at colleges around the country. A state Supreme Court in Kentucky is weighing a lawsuit from a local newspaper that seeks to compel the University of Louisville Foundation to reveal the identities of 62 anonymous donors.

The truth is donors who give over $5,000 and try to claim a deduction must be listed on a group's Form 990.
Wealthy philanthropists last year made 37 gifts of $5 million or more without publicly revealing their names. That's up from 27 such gifts in 2006, and just 13 in 2004, according to an analysis by the Center on Philanthropy at Indiana University. Such publicity-shy donors say they want to give back to their communities but avoid the headaches of a high public profile, including pushy fund-raisers, jealous relatives and even risks to their personal safety.
One way around this problem is the donor advised funds, "which allow donors to give to a charity in the name of the entity that runs the fund, often a financial-services firm. What's more, donor-advised funds come with attractive tax breaks -- up to 50% compared to a maximum 30% when giving through a private foundation."

I'm going to focus on donor advised funds (DAFs) all at Don't Tell the Donor. If you have story ideas let me know.


Sam Davis said...

"Meet the new boss, same as the old boss."-- The Who

The federal government has been used duplicitously, and unconstitutionally, to regulate free speech since the first campaign finance "reforms" in the 1970s. McCain-Feingold is egregiously unconstitutional, its principal authors statists who wish to create a quasi-aristocracy of lifetime-office-holding politicians.

Current calls for regulation of private giving flow from the same poisoned source.

Private property rights, as envisioned by Locke and others, included a large presumption of privacy as a means of deterring government tyranny over persons and their liberty and property.

Every forced disclosure of private economic activity has as its ultimate purpose tighter control of all private activity by government. The cloak of "public interest" is used to cover the real intent.

Ethically and morally, it is unacceptable to require that private individuals disclose their philanthrophic activities. Politically, such disclosures are not used to "protect" ordinary citizens. Instead, further control of the use of private money -- an uncompensated taking if one reads the Bill of Rights strictly -- is granted the political class.

A new feudal artistocracy is being formed, consisting of a political class that holds office virtually for life, and the leaders of special interest group allies of the political class.

Just as Europe's Medieval aristocracy rationalized their absolute tyrannies with such nonsense as divine rights and right of conquest, today's nascent aristocracy rationalizes its pseudo-tyranny with warm fuzzies such as "public interest."

We are being fooled, again.

Joseph.Berman said...

"The truth is donors who give over $5,000 and try to claim a deduction must be listed on a group's Form 990." So I'm spending some time on guidestar with 990's and most of the organizations I'm looking at don't actually list hte donors. Do you know why/how that is? Thanks! Joseph