Donor-Advised Funds Are All the Rage in Charitable Giving

Donor-Advised Funds Are All the Rage in Charitable Giving

Assessment

Interactive Video

Business, Social Studies

University

Hard

Created by

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The video discusses the rise of donor advised funds (DAFs) in philanthropy, highlighting their popularity and the role of financial institutions like Fidelity and Schwab. It explains how DAFs bypass regulations imposed on private foundations, offering tax benefits without payout obligations. Behavioral economics influences donor behavior, often leading to funds remaining unspent. Financial advisors benefit from management fees, promoting DAFs over direct donations. The video concludes with potential regulatory scrutiny due to the significant tax advantages and lack of transparency in DAFs.

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7 questions

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1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What has contributed to the rise in popularity of donor advised funds?

Their association with well-known financial institutions

Mandatory charitable contributions

Higher interest rates on savings

Increased government funding

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What was the primary concern of Congress in 1969 regarding private foundations?

High administrative costs

Donor control over funds without spending

Excessive charitable spending

Lack of public awareness

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

How do donor advised funds differ from traditional charities in terms of fund distribution?

They are only for small donations

They have mandatory payout rules

There is no obligation for funds to be distributed

They offer higher tax benefits

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What psychological factor affects donors' decisions to distribute funds from their DAF accounts?

Feeling of satisfaction from watching the account grow

Desire to maintain anonymity

Pressure from financial advisors

Fear of losing tax benefits

5.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Why might financial advisors encourage clients to use donor advised funds?

To avoid taxes

To increase their management fees

To simplify the donation process

To support local charities

6.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is a potential issue with the transparency of donor advised funds?

Donors cannot track their contributions

They are not regulated by the government

There is limited visibility into how funds are managed

They do not provide tax benefits

7.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What might prompt Congress to review the regulations surrounding donor advised funds?

The increasing number of DAFs

The decline in traditional charity donations

The large tax benefits without distribution requirements

The involvement of international donors