DAFgiving360, the donor-advised fund provider affiliated with Charles Schwab, reported on January 27, 2026, that its donors granted a record $9.9 billion to more than 165,000 charities during 2025, up 28% from 2024. CNBC and other outlets picked up the figures days later as part of a broader pattern across the donor-advised fund industry: a surge in both contributions into these accounts and grants out of them, driven largely by wealthy donors moving before new limits on the charitable deduction take hold in 2026 under the One, Big, Beautiful Bill Act.
What changed
A donor-advised fund lets a donor contribute cash or securities, take the tax deduction in the year of the contribution, and recommend grants to specific charities over any timeline afterward. DAFgiving360 said 2025 was its fourth consecutive year of double-digit growth in grants, with donors recommending 1.5 million grants, up 20%, and giving at a pace of more than $27 million a day. Notably, 74% of 2025 contributions into these accounts arrived as non-cash assets such as appreciated stock, rather than cash, a sign that donors used a strong stock market to fund large, tax-advantaged gifts before values might be locked in for the year. Giving appreciated stock instead of cash carries its own after-tax benefit regardless of the OBBBA changes, since the donor generally avoids capital gains tax on the appreciation while still deducting the full fair market value, a combination that becomes only slightly less generous, not eliminated, under the 2026 rules.
Who is affected
The behavior reflects a deadline that mattered specifically to higher-income itemizers. Starting with the 2026 tax year, the OBBBA imposes a new floor equal to 0.5% of adjusted gross income below which charitable contributions are not deductible at all, and it caps the value of the deduction at 35 cents on the dollar for taxpayers in the top 37% bracket, rather than letting it offset income at their full marginal rate. Because a donor-advised fund locks in the deduction at the moment money goes into the account, not when it is later granted to a working charity, contributing in 2025 preserved the pre-2026 tax treatment while leaving the timing of actual grants to charities flexible.
The after-tax math
Example: a donor with $2,000,000 of adjusted gross income in the top bracket gives $50,000 to charity. Under 2025 rules, with no floor and a full 37% benefit, the gift reduces the tax bill by about $18,500, for an after-tax cost of about $31,500. Under 2026 rules, the first $10,000 of the gift, 0.5% of the $2,000,000 AGI, is not deductible at all, leaving $40,000 deductible, and that amount is only worth 35 cents on the dollar, producing a tax benefit of about $14,000 and an after-tax cost of about $36,000. Making the same $50,000 contribution to a donor-advised fund before year-end 2025, instead of in 2026, was worth roughly $4,500 more in current-year tax savings on this example, without requiring the donor to have picked a final charity yet.
Moves to discuss with your advisor
Households that already used a donor-advised fund to bunch multiple years of giving into 2025 have effectively pre-funded 2026, 2027 and later grants at the old, more favorable tax treatment, and a CPA can help time the actual grant recommendations without further tax consequences, since grants out of the fund are not separately deductible. Donors who did not act before year-end may still want to discuss whether bunching several years of planned giving into a single future tax year makes sense under the new floor and cap, since a larger single-year gift clears the 0.5% floor more efficiently than smaller annual gifts.
What to watch
Industry-wide donor-advised fund data for all of 2025, from providers such as Fidelity Charitable, Vanguard Charitable and National Philanthropic Trust, will arrive over the coming months and should show whether the pattern DAFgiving360 reported was industry-wide. Philanthropy researchers, including Indiana University's Lilly Family School of Philanthropy, have estimated the new deduction limits could reduce annual charitable giving by billions of dollars once the front-loading effect fades, a trend worth watching in 2026 and 2027 grant and contribution totals.
Sources
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