America’s biggest “charity” is built on a lie

Fidelity Charitable took in $9 billion in tax-deductible contributions last year. It’s unlike any charity you know.

As the season of giving comes to a close, we can be sure of this: The charity that will raise more money than any other in 2019 will be Fidelity Charitable, an enterprise that manages the charitable giving of more than 200,000 mostly well-to-do clients.

While legally classified as a 501(c)(3) nonprofit, Fidelity Charitable is a charity in name only. In fact, it functions as a middleman where donors can invest their money for as long as they like before giving it to what most of us would recognize as a real charity. Fidelity Charitable has grown like wild in recent years because clients can take a tax deduction immediately when they deposit money in Fidelity Charitable, even if they have no intention of giving the money away anytime soon.

Last year (2018), Fidelity Charitable collected $9bn in deposits. That’s more than the combined haul of the five biggest actual charities — the United Way, the Mayo Clinic, the Salvation Army, Alsac/St. Jude’s Children Hospital and Harvard — on the list of America’s Favorite Charities compiled annually by The Chronicle of Philanthropy.