Ask which is the largest charity in the United States and you will not guess the answer, because it is not a soup kitchen or a university or a hospital. By the money that flows in and back out of it, the biggest charity in America is Fidelity Charitable, the giving arm of the Fidelity Investments empire. It takes in more donations than any other charity and hands out more grants than any other grantmaker, and yet it is, in a real sense, a waiting room: a place where money sits, invested and untaxed, until its donor decides where it should go, with no legal deadline that it ever must. This is the quiet machine of the donor-advised fund, and it belongs to one of the richest families in the country. Everything below is from the filings.
What a donor-advised fund actually does
A donor-advised fund, or DAF, is a giving account held at a sponsoring public charity. The mechanics are simple and, for a donor, close to ideal. You contribute cash or, better, appreciated stock, and the gift is irrevocable, which earns you an immediate charitable tax deduction, up to 60 percent of your income for cash and 30 percent for appreciated assets (IRS on donor-advised funds; National Philanthropic Trust). If you give appreciated securities, you also skip the capital-gains tax you would owe if you sold them, while deducting their full market value (National Philanthropic Trust). The money then sits in the account, invested, growing tax-free, and you "recommend" grants to real charities whenever you like.
The catch, and it is the whole story, is in that last part. Unlike a private foundation, which the Tax Reform Act of 1969 requires to pay out about 5 percent of its assets every year, a donor-advised fund is under no obligation to distribute anything, ever (Congressional Research Service, R42595). You take the tax deduction the year you contribute. The money reaches a working charity whenever you decide, which the law says can be next year, in thirty years, or after you are dead. The deduction is immediate. The charity waits.
The nation's biggest "charity"
No one has run that machine at greater scale than Fidelity Charitable, and its filings are staggering. For the year ending June 2025 it reported $30.63 billion in total revenue and held $85.86 billion in net assets, up from $66.54 billion a year earlier (ProPublica, EIN 11-0303001). In calendar 2025 it made $18.3 billion in grants across three million individual gifts to nearly 227,000 charities, and since its founding in 1991 it has granted about $118 billion (Fidelity Charitable 2026 Giving Report). It has topped the Chronicle of Philanthropy's ranking of American charities by donations received every year since 2016, when it displaced United Way, the first donor-advised-fund sponsor ever to lead the list, and it became the single largest grantmaker in the country in 2018, surpassing the Gates Foundation (Fidelity Charitable; Inside Philanthropy). Forbes leaves it off its list of top charities entirely, on the grounds that a DAF sponsor is "not an operating charity but a holding vehicle for money" (Forbes).
Fidelity Charitable is not alone; it is the biggest of a class. The comparable arm of Charles Schwab, now called DAFgiving360, granted more than $6.6 billion in its 2024 fiscal year, and Vanguard Charitable granted $3.9 billion in 2025 (DAFgiving360; Vanguard Charitable). Nationally, donor-advised funds held about $327.87 billion at last count, up from $229 billion just two years earlier, spread across some 3.6 million accounts (DAF Research Collaborative). The fastest-growing corner of American philanthropy is a set of accounts run, in the main, by Wall Street asset managers.
The family in the waiting room
Follow Fidelity Charitable back to its parent and you arrive at the part the user of this series asked to see. Fidelity Investments is privately held through FMR LLC, and the Johnson family owns roughly 49 percent of it, with current and former employees holding the rest (Forbes). Fidelity was founded by Edward C. Johnson II in 1946; his son, Edward "Ned" Johnson III, built it into a mutual-fund colossus and died in 2022; and Ned's daughter Abigail Johnson runs it now as chairman and chief executive, the single largest shareholder at about 29 percent, with a personal fortune of $39.9 billion and a family fortune of $69.5 billion that ranks fourth among America's richest families (Wikipedia, "Fidelity Investments"; Forbes on Abigail Johnson). The for-profit firm they control administered $18.0 trillion and managed $7.1 trillion in assets at the end of 2025 (Fidelity 2025 annual report).
Fidelity Charitable is a legally separate nonprofit with its own board. But the connection runs deeper than the name. Fidelity's own affiliates provide the investment management and administrative services for the charity's accounts, and they collect fees for doing it: donors pay an annual administrative fee of 0.60 percent, and the invested money sits in Fidelity-managed pools (Fidelity Charitable legal disclosures; Fidelity Charitable fees). The Institute for Policy Studies estimated that fee flow was worth roughly $245 million a year to Fidelity Investments, a figure Fidelity has not confirmed (Institute for Policy Studies). So the same family ecosystem runs a multi-trillion-dollar asset manager and the nation's largest charity, and the charity's tens of billions are invested by, and pay fees to, the asset manager. That is the structure worth observing.
The argument over the waiting room
Whether this is good or bad depends on how long the money waits, and that is exactly what the fight is about. Critics call it warehousing. The Boston College law professor Ray Madoff, the leading academic voice against DAFs, argues they "are warehousing huge amounts of funds while nonprofits struggle," and that donors get an immediate tax break for money that is not required to reach a working charity "ever" (Inside Philanthropy). She notes the scale of the shift: in 1990, about 6 percent of American charitable dollars went to foundations and DAFs and the rest went straight to charities; today roughly 41 percent goes to those intermediaries first (Inside Philanthropy).
The defense is real and worth stating. In the aggregate, DAFs pay out far faster than the 5 percent foundations must: the national payout rate was about 25 percent last year, and Fidelity Charitable reports that 42 percent of every dollar contributed is granted within a year and roughly three-quarters within five (DAF Research Collaborative; Fidelity Charitable). The counter to the counter is that an average masks the dormant accounts, the ones that sit for years granting nothing, which the account-level data confirm exist. A reform bill, the Accelerating Charitable Efforts Act, would have forced the money out within 15 years to keep the upfront deduction, or deferred the deduction until the money actually moved; introduced in 2021 by Senators King and Grassley, it stalled and went nowhere (Council on Foundations summary; Philanthropy Roundtable).
Strip away the debate and the structure is the point this series keeps arriving at. Like the church reserve that compounds untouched and the foundation corpus that grows faster than it gives, the donor-advised fund is a pool of money that has already earned its tax benefit and is under no obligation to do its charitable work on any schedule. What makes it distinctive is who holds it: not the donor, and not quite a charity in the ordinary sense, but the charitable subsidiary of a Wall Street firm, which invests the money and collects the fee while the gift waits. The deduction is immediate. The charity is patient. And the biggest one in America is a waiting room with a family's name on the building next door.
Related reading
- The Rules Beneath the Endowment: the 5 percent foundation payout the donor-advised fund is not subject to, and the reform bill aimed at it.
- The Hundred-Billion-Dollar Reserve: another tax-exempt pool that compounds with no payout requirement.
- The New Fortunes: the private foundations whose corpuses grow faster than they give.
- The Working Ledgers: the market underneath every reserve that holds money.
Fact-check notes and sources
- How a donor-advised fund works (the irrevocable contribution, the immediate deduction up to 60 percent of income for cash and 30 percent for appreciated assets, the avoidance of capital-gains tax on donated securities, the tax-free growth, the donor's advisory-only privileges, and the absence of any payout requirement in contrast to the roughly 5 percent private foundations must distribute): IRS on donor-advised funds, National Philanthropic Trust tax considerations, and Congressional Research Service R42595.
- Fidelity Charitable's scale (total revenue of $30.63 billion and net assets of $85.86 billion for the year ending June 2025; $18.3 billion in grants in calendar 2025 to nearly 227,000 charities and about $118 billion since 1991; the number-one ranking by donations received since 2016 and largest-grantmaker status since 2018): ProPublica, EIN 11-0303001, Fidelity Charitable 2026 Giving Report, Fidelity Charitable news, and Inside Philanthropy. The other giants and the national totals ($6.6 billion at DAFgiving360, $3.9 billion at Vanguard Charitable, and about $327.87 billion in DAF assets nationally): DAFgiving360, Vanguard Charitable, and the DAF Research Collaborative.
- The Johnson family and Fidelity (FMR LLC privately held with the Johnson family owning about 49 percent; Edward C. Johnson II founding Fidelity in 1946, Ned Johnson III building it and dying in 2022, and Abigail Johnson as chairman and CEO, largest shareholder at about 29 percent, with a $39.9 billion personal fortune and a $69.5 billion family fortune ranked fourth; Fidelity's $18.0 trillion administered and $7.1 trillion managed; and the affiliate management of Fidelity Charitable's pools, the 0.60 percent fee, and the roughly $245 million estimated annual fee flow): Forbes on Edward Johnson, Wikipedia, "Fidelity Investments", Forbes on Abigail Johnson, Fidelity 2025 annual report, Fidelity Charitable legal disclosures, and Institute for Policy Studies. The $245 million figure is an estimate, not a Fidelity-confirmed number.
- The debate and the reform bill (the warehousing critique, the shift from 6 percent to 41 percent of charitable dollars going to intermediaries, the roughly 25 percent aggregate payout and Fidelity's 42-percent-within-a-year figure, and the stalled Accelerating Charitable Efforts Act): Inside Philanthropy, DAF Research Collaborative, Fidelity Charitable 2025 Giving Report, Council on Foundations, and Philanthropy Roundtable.
This post is informational, not tax or financial advice. All figures are reproduced from the cited filings and public record. Institutions and individuals are discussed as nominative fair use from the public record, with no affiliation implied.
