DAF Spotlight: Complex Assets

How NPT Donors Fund Their Philanthropy


National Philanthropic Trust (NPT)’s mission is to increase philanthropy in society. To reach the goals of that mission, we partner with donors, families, financial institutions and other organizations to make grants that support a wide range of charitable organizations. We are incredibly proud of our robust grantmaking: in Fiscal Year 2021 alone, NPT granted more than $6 billion to charitable purposes around the world.

There is another important piece of grantmaking: how grants are funded. After all, without contributions to their donor-advised funds (DAFs), donors will not have assets available from which to recommend grants.

Over the last five years, NPT’s donors contributed billions of dollars to DAFs, all of which will support their charitable grantmaking. But how, exactly, did they make those contributions? Which assets did they donate? What is the process, from start to finish? In this analysis, we look at how NPT’s donors fund their DAF philanthropy and where that charitable support goes.

How We Define Contributions

For the purpose of this report, we categorized contributions by asset type, which we define as:


Money in the form of checks, wires and credit card payments.

Publicly traded securities

Stocks, bonds, mutual funds and other financial instruments that are listed and traded on public exchanges.

Complex assets

All other assets that are non-cash and non-publicly traded securities including, digital currencies, real and tangible property, and shares of privately held companies.

Contribution Growth in Recent Years

At NPT, both contributions and grants have increased in both dollars and volume over the last five years. This growth coincides, in part, with increased charitable need in the form of natural disasters, polarizing political environments and the emergence of the COVID-19 pandemic.



Contributions by Asset Type

Donors make contributions to DAFs so that they can recommend grants to support charitable organizations and causes. Every dollar in a DAF must be used for charitable purposes and donors cannot receive any personal benefit that would be considered more than incidental.

In recent years, donors have increasingly looked beyond their checking accounts for ways to support their favorite organizations and causes and meet urgent charitable needs. On average, non-cash assets—including publicly traded securities, real property and cryptocurrency—accounted for more than half of total contributions to NPT DAFs over the past five years.

Annual Average of Contributions by Asset Type


NPT’s fiscal year runs July 1 – June 30, meaning this five-year period begins July 1, 2016 and ends June 30, 2021.  The data in this report come from NPT’s annual IRS Form 990 filings.

At NPT, the assets donors use to fund their grantmaking change year-to-year. When the stock market rises, contributions of publicly traded securities typically do, too. Publicly traded securities have been the most popular type of asset contributed in three of the last five years.

In periods where the stock market declines, we tend to see more cash contributions. When cryptocurrencies experience rapid appreciation, we see more frequent and larger contributions of digital currencies. There are always individual circumstances—retirements, inheritances, selling of companies—that can motivate a donor to add to or create their DAF.


A Deeper Look at Complex Assets

Complex assets comprise the smallest percentage of contributions by asset type and require the most due diligence and time. Complex assets can include tangible property (such as artwork, jewelry or rare coins), shares of privately held companies and cryptocurrencies. Donors choose to contribute complex assets to their DAFs for several reasons. First and foremost, donors make contributions to their DAFs because they want to be philanthropic. All contributions to a DAF are irrevocable and must be used exclusively for charitable purposes.

Some additional motivations can include:

Charity’s request

Charities are often the referral source for complex assets.


Complex assets can create significant tax liabilities when a donor sells them.

Estate planning

Some complex assets can be complicated or undesirable to bequeath to the next generation.

  • Charity’s request: Charities are often the referral source for complex assets. Some charitable organizations cannot or will not accept complex assets as donations. They may not have the internal resources, capacity or expertise to conduct due diligence or effectively liquidate the asset. Instead, the donor can contribute a complex asset to their DAF, then recommend a grant to the referring charity. NPT acts as a partner in performing the due diligence and liquidation process for charities that cannot manage this sometimes-complex process.
  • Taxes: Complex assets can create significant tax liabilities when a donor sells them. When a donor gifts them to a charity or charitable giving vehicle, it can provide a tax advantage which preserves funds for charitable grantmaking. A common example: corporate founders may donate shares of their privately held company—which often have a $0 cost basis. Donating shares can reduce a future capital gains tax liability when they wish to sell their shares, or when the company is sold, merged or goes public, helping them accomplish their philanthropic goals.
  • Estate planning: Some complex assets can be complicated or undesirable to bequeath to the next generation. A UBS study found that 81% of wealthy collectors plan to pass their collections on to their children, but only one-third (31%) of children want to inherit them. By donating these assets to a DAF, donors may be able to align their family values with their philanthropic goals, while also simplifying their estate administration. Moreover, many DAF sponsors allow donors to appoint additional advisors and successors to the DAF so that it can serve as a multigenerational giving vehicle.


Life Cycle of a Complex Asset With Emphasis on Due Diligence


Step 1: Inquiry

Donors, or their professional advisors, contact NPT to discuss the proposed asset for contribution. Initial discussions are often focused on the asset type, timing of an expected sale of the asset or anticipated liquidity event, any potential tax implications of the gift or the subsequent disposition of the asset, carrying costs, restrictions on the asset and issues around control and excess benefit.

Step 2: Due Diligence

If the general facts and circumstances of a proposed contribution are acceptable, NPT will begin its due diligence process on the complex asset. The due diligence process seeks to identify and work through any legal and/or tax issues that could arise in connection with the contribution for both NPT and the donor(s), and helps determine risk, cost and transferability. It also ensures that donating the asset will not confer any improper benefit upon the donor(s). We require documentation including, but not limited to (as applicable): incorporation/formation documents; shareholder, operating or partnership agreement; transfer agreement or assignment of interest; audited financial statements; and any other documents or agreements that will affect NPT’s ownership such as voting rights, rights of first refusal or co-sale agreements. This process typically takes between two and eight weeks, depending on the type of asset.

Step 3: Accept or Decline

NPT’s due diligence process and discretion determine if we will accept an asset. Once we decide to accept a complex asset, the donor will complete a contribution agreement form and provide any additional necessary documentation. NPT also asks donors to sign a gift agreement setting forth the terms of the gift. Donors are responsible for obtaining an independent qualified appraisal of the asset for income tax purposes. If we decline to accept an asset, we try to recommend another strategy for converting the assets into charitable capital, such as donating artwork to a museum.

Step 4: Liquidate + Fund DAF

NPT seeks to liquidate complex assets as quickly as practical following acceptance of the contribution. Some assets, like cryptocurrencies, are liquidated immediately, while others, like real estate or tangible property, may have a longer holding period. Recognizing that the donor assigns full legal ownership to NPT when they contribute the asset, NPT retains sole discretion regarding when to liquidate the asset, subject to any restrictions in the governing documents. Proceeds from the liquidation of any complex asset become the funds from which DAF donors recommend grants. In certain cases, NPT will restrict some of the proceeds or require an additional cash contribution to cover any of the asset’s carrying costs (such as insurance) or other related expenses.

Step 5: Grant

Once the proceeds are transferred to the DAF, donors can begin recommending grants. Some donors already know which charitable organizations they wish to support and will recommend grants immediately. For others, their contribution represents their first significant commitment to philanthropy, and they may wish to plan their grantmaking strategy before making recommendations. In NPT’s experience, these donors typically recommend grants within a year of their contribution.

Complex Assets We’ve Accepted

Art and Jewelry

A donor wanted to use an original modernist painting and jewelry from a personal collection to support charities. NPT conducted due diligence on the pieces and advised the donor to consult a tax advisor about the tax implications of contributing these assets to a DAF. Because a gift of art and jewelry to a DAF does not constitute a “related use” gift, the donor could only claim a tax deduction for the lesser of the cost basis or fair market value of the assets. The donor was not motivated by the tax deductions and NPT accepted the contribution. We partnered with an auction house to take custody of and liquidate the assets, which ultimately sold for more than $20 million within 30 days of the contribution. The donor began recommending grants immediately, creating multi-year and recurring grants to fund women’s causes.

Restricted Stock

A donor founded and was part of the control group of an athleisurewear company and wanted to use some shares of the company to support nutrition programs in local schools. NPT did due diligence to confirm all relevant details of share acquisition, transferability, holding periods and ownership restrictions. NPT, the donor and advisors worked together to facilitate the contribution of the shares during an open trading window for the donor, and liquidated the shares immediately upon receipt. The donor used the proceeds to recommend grants to fund the school nutrition programs, which the donor has continued to support for several years while also expanding grantmaking from the DAF.

Commercial Building

A couple started and managed an LLC that owned a commercial building in Wisconsin. The donors wanted to sell the building and use the proceeds to fund their philanthropy. NPT’s due diligence required reviews of both the LLC and the building, which included title and lien searches, reviews of books, contracts, leases, insurance policies and an environmental study. NPT accepted 100% ownership of the LLC and worked with a local broker to sell the building, which was under contract in less than one week. The donors have since used their DAF to support various local charities and places of worship in their home state.

Complex Assets We’ve Declined

A Military Tank

A donor wanted to turn piece of American history—a military tank, in this case—into philanthropic support for his favorite charity. While the tank had an impressive history, NPT did not have an appropriate way to dispose of it. Instead, we encouraged the donor to donate it directly to a military museum, where it would be meaningfully appreciated. A museum donation would afford the donor the greatest tax advantage for this particular asset, as well.

Restricted Stock

A donor wished to transfer shares of a publicly traded company to NPT subject to a restrictive legend. NPT completed due diligence and determined that we could accept the shares. The donor had hoped that NPT would sell the shares soon after receipt to fund the donor’s philanthropy. However, because NPT was not specifically identified in the registration statement covering the securities, NPT would have to sell pursuant to SEC Rule 144, which would not be available for at least 10 months. While NPT was willing to hold the shares, the donor decided to sell the shares into the market immediately and make a subsequent donation of cash.

Real Estate

A donor wished to contribute a residence but retain a life estate in the property and continue to reside there. NPT will not accept property that is occupied by a donor or related party, and NPT does not agree to hold real estate long-term. NPT’s goal is to sell real estate as soon as possible following acceptance of the contribution to reduce risk and generate liquidity for grantmaking.


Donors contribute to their DAFs so that they can recommend grants to support their favorite charities and causes. Cash contributions are popular. However, in three of the last five years, non-cash assets have been the majority asset type for contributions to NPT DAFs. Of all non-cash contributions, publicly traded securities are by far the most common type. While complex assets are less common and lower in aggregate value than publicly traded securities, they provide a significant and meaningful source of charitable support. We expect the trend of donating non-cash assets will continue.

DAF donors want to give.

They see a continued need to address existing and future challenges through granting philanthropic support. This is evidenced by NPT’s own rapid increase in grantmaking—grant dollars increased more than 700% in the last five years. With a marked grant growth in just the last few years, donors have experienced how DAFs can support their giving goals with immediacy, sustain them in times of protracted hardship and provide for future societal needs.

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