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Accelerating Charitable Efforts: New Rules for Donor Advised Funds

This act modifies tax rules for donor advised funds to speed up the distribution of charitable contributions. Citizens using these funds may see changes in how their donations are tax-deductible and the timelines for funds to reach beneficiaries. The goal is to encourage quicker deployment of accumulated funds for social causes.
Key points
Deduction limitations: Tax deductions for contributions to donor advised funds will only be allowed after the funds are actually distributed to charities, not at the time of contribution to the fund.
New distribution deadlines: Donor advised funds (with some exceptions for community foundations) must distribute contributions to charities within a specified timeframe (e.g., 14 or 49 years), or face a tax penalty.
Changes for private foundations: New rules define what counts as a qualifying distribution, including disallowing certain administrative expenses and contributions to donor advised funds.
Tax exemptions for active foundations: Private foundations that make significant qualifying distributions (at least 7% of asset value) may be exempt from investment income tax.
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Additional Information
Print number: 117_S_1981
Sponsor: Sen. King, Angus S., Jr. [I-ME]
Process start date: 2021-06-09
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Summarized by: gemini-2.5-flash
Source data: api.congress.gov
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OFFICIAL LEGAL TITLE

ACE Act

FREQUENTLY ASKED QUESTIONS

What is the official ID of this bill?

The official print number for this legislation is 117_S_1981.

Which chamber initiated this legislation?

This legislation was initiated in the Senate.

When did the legislative process begin?

The process officially started on 2021-06-09.

What are the main provisions?

Key points include:

  • Deduction limitations: Tax deductions for contributions to donor advised funds will only be allowed after the funds are actually distributed to charities, not at the time of contribution to the fund.
  • New distribution deadlines: Donor advised funds (with some exceptions for community foundations) must distribute contributions to charities within a specified timeframe (e.g., 14 or 49 years), or face a tax penalty.
  • Changes for private foundations: New rules define what counts as a qualifying distribution, including disallowing certain administrative expenses and contributions to donor advised funds.
  • Tax exemptions for active foundations: Private foundations that make significant qualifying distributions (at least 7% of asset value) may be exempt from investment income tax.
What is the specific legal status?

The current status is Expired.

Where can I read the full text of this legislation?

The full official text is available at: View full text

Who is the primary sponsor?

The primary sponsor is Sen. King, Angus S., Jr. [I-ME].

What is the latest detailed status?

The latest detailed status is: Introduced in Senate

Is this summary verified?

Yes. This content was analyzed by AI and verified by the Lustra Judge System on 2026-01-02.

CATEGORIES

Taxes