Great podcast on political activity by nonprofits including through donor-advised funds
I’ve recommended the podcast Taxes for the Masses on this blog before. The hosts, Lisa De Simone and Bridget Stomberg, are accounting professors who break down tax issues for those without a tax background, and I really value that project. They occasionally talk about issues related to tax-exempt nonprofits, as was the case two weeks ago when they released an episode about restrictions on political activity by charities and a little about donor-advised funds.
The bulk of the episode is an overview of the political-activity restrictions on charities. They do a good job of explaining why deductions for charitable giving are so much more valuable to wealthier taxpayers, especially for donations of appreciated property, and the connection between that and the political-activity restrictions.
The part on donor-advised funds first provides a very brief explanation of what a donor-advised fund is. As always, I could find things to quibble with, like I think they imply that a donor to a donor-advised fund loses control of the timing of the distributions from that fund, which is not really true, but I understand from personal experience how hard it is to give an overview without simplifying sometimes in ways that are misleading. But then they move quickly into a description of a paper by Helen Flannery and Brian Mittendorf, which finds that grants to “politically engaged charities” are made through donor-advised funds more often than they are made through other giving methods. Flannery and Mittendorf theorize that donors may prefer giving through donor-advised funds to charities that do significant lobbying or have politically-engaged 501(c)(4) affiliates, because donor-advised funds provide greater donor privacy protection than private foundations. I’m not sure I agree 100% with De Simone’s and Stomberg’s takeaways from the paper, but I think it’s wonderful to have podcasts that present serious academic work on exempt organizations “to the masses.”
–Benjamin Leff