Donor Advised Funds
In the preamble to the temporary regulations (T.D. 8920), the Service asked for comments regarding the potential issues raised by applying the fair market value standard of section 4958 to distributions from a donor advised fund to (or for the use of) the donor or advisor of such fund.

We note that section 4958 already applies to sponsoring charities of donor advised funds. Treating each donor advised fund inside a sponsoring charity as an operating department (or division) raises numerous questions, including whether such treatment would require a legislative change and whether sponsoring charities should be singled out among all public charities for such treatment.

We considered whether to provide detailed comments regarding the application of the fair market value standard of section 4958 to distributions from a donor advised fund to (or for the use of) a donor or advisor. Upon reflection, however, we decided that such comments might best come from sponsoring charities of donor advised funds, including community foundations, the national donor advised funds, and other public charities.