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In a Nutshell: Every law has unintended consequences, and new research from the Institute for Policy Studies demonstrates the laws around charitable giving are no exception. The study documents how wealthy donors use identity-masking donor-advised funds and private foundations to direct billions to charities focused on preserving the climate status quo. They secure tax deductions while influencing policy in their favor and concealing their support, ultimately shifting the financial burden to everyday taxpayers.
It’s 2025 — maybe you’re tired of hearing about how climate change makes almost every new summer the hottest on record. So let’s switch gears for a bit and reflect on how your tax dollars effectively subsidize the disinformation and political gridlock that brought us to where we are today.
You’re paying for the climate status quo through the IRS not because of some strange conspiracy but because many wealthy people know how to take advantage of the laws around charitable giving to influence policy in their favor.
They’re taking the significant tax deductions allowed through the law while contributing billions to charities they ultimately control, ensuring donations flow to interests they favor.

We know this thanks to “Fossil Fuel Philanthropy,” a recent study from the Institute for Policy Studies that documents the role of donor-advised funds and private foundations in charitable giving.
Donor-advised funds depend on donors to recommend grants to their favorite charities, ensuring billions flow to industry-friendly think tanks and policy groups with a mission to call the scientific consensus around climate change into question.
That’s enough for lawmakers (and presidents) who represent fossil fuel interests to doom significant climate action despite the overwhelming consensus among American scientific institutions around human influence on climate.
“If you’re really wealthy, charitable giving not only reduces your income tax obligations, it also reduces your capital gains, your estate taxes, and your gift taxes,” said study co-author Chuck Collins, Director of the Program on Inequality and Common Good at the Institute and Co-Editor of Inequality.org. “In fact, one estimate found that up to 74 cents of every dollar given by billionaires to their charities is lost tax revenue — or, effectively, the rest of us chipping in to pick up the slack.”
Your Tax Dollars at Work?
The Institute of Policy Studies is the nation’s “oldest multi-issue progressive research organization,” according to its website, with a more than 60-year track record of grassroots social justice partnerships and policy advocacy.
Collins has been at the Institute for 18 years. Part of the mission of the Program on Inequality and the Common Good is to probe the laws and trends around charity and assess how inequality is affecting the space. “Fossil Fuel Philanthropy” takes things a step further by looking at wealth concentration and climate disruption through a single lens.

“Our concern is that charity is becoming an unaccountable sector — more and more wealthy individuals are using charitable giving as a way to mask their financial interests or channel money to dark-money-type organizations,” Collins said. “People who have an interest in promoting oil, gas, and coal in their private businesses are using the charity system to fund disinformation think tanks and research groups.”
It’s particularly concerning because only about 10% of Americans itemize their taxes and take charitable deductions. That leaves the other 90% with the responsibility to bridge the policy and coverage gaps those deductions create.
“The charities behind climate science denial are well-funded, interconnected, and have influence at the highest levels of government,” Collins notes with his co-authors Helen Flannery and Bella DeVaan. “Much of their future profit relies on continued inaction on climate change and the delay of regulation.”
How potentially impactful are the dollars involved? “Fossil Fuel Philanthropy” found that 137 climate disinformation organizations received $5.8 billion in charitable donations from 2020 to 2022. Six of those organizations that are “largely or entirely” focused on climate issues promote climate disinformation. These organizations alone received $219 million in contributions.
“Because they are not required to disclose their revenue allocations to specific issues, we have no way of knowing how much of the $5.8 billion total was used to fund climate disinformation,” Collins and his co-authors noted.
Donors Gain Significant Tax Benefits
It’s one more example, Collins said, of how big industries have essentially captured the political apparatus with little oversight, accountability, or pushback. Charitable giving is just one of their influence tools, along with direct giving to candidates and advocacy groups.
“For wealthy influencers, charitable giving is one tool in their influencer toolbox,” Collins said.
Collins said he was surprised at the scale of the problem. It’s impossible to know how much of the $5.8 billion figure cited above went to climate disinformation because it’s mostly not reported and not transparent.
“But one of the points of our report is there should be transparency,” Collins said. “Given that we subsidize the charitable giving system, it seems reasonable that we should know where the money goes — just like we want to know where our tax dollars go.”

Donor-advised funds help mask the intent behind those contributions. Three large advised funds — Schwab Charitable, Donors Trust, and the National Philanthropic Trust — collect the bulk. Giving to one mitigates the potential public relations damage of a concerned journalist discovering a donor’s support of a climate disinformation organization.
“All of a sudden, you’ve lost the trail. You can’t track an individual gift anymore — and that’s deliberate,” Collins said.
But as we noted above, donor-advised funds depend on givers’ advice on how to target contributions.
That ties the bow in a nice little knot. All charities must disclose their donors, but breaking the chain of influence requires observation to deduce that those relationships exist.
Collins said it’s a corruption of well-intended regulations. It makes sense to offer a tax deduction to those who surrender dominion and control over their money. But the law didn’t predict the unintended consequence of donor-advised funds.
“Most people give in a generous, non-self-interested way,” Collins said. “I would say this is a manipulation of a good system.”
Fight Back Through Mission-Aligned Investing
The Institute for Policy Studies agrees with most advocacy organizations and climate experts that we here on Earth are passing several points of no return regarding climate.
Collins said half of Americans seem to have woken up to understand that this is a real threat, and yet we can’t seem to change the trajectory.
“At a certain point, you realize, wow, the fossil fuel industry really has done a good job spending their money to block change,” Collins said. “The industry is using its wealth, power, and position to run out the clock.”
Whatever you think about the recent election, it’s safe to say moving into a new political era in 2025 promises more of the same. We can’t find data to back this up. Still, our intuition suggests a majority of subprime borrowers and those struggling with credit card debt, delinquency, and default voted for a change in administration.
American taxpayers will likely continue to compensate the government for what the wealthy are taking out of the system through their charitable giving, paying for new fossil-fuel infrastructure instead of for a greener future.
“Fossil Fuel Philanthropy” found that only about 10 private foundations (out of the total of 137 we reported above) are giving huge amounts to climate disinformation. The report names names, calling on those interested in changing the energy and climate status quo to fight back through intentional investing.
That means looking for pooled investment funds that eschew fossil fuel in favor of proactively clean energy. Many have competitive returns, Collins said.
The other part of the mission is to hound policymakers for change, which Collins and the Institute are happy to support. He said people on the left and right alike understand the value of transparency and how it can hold donors accountable.
“We’re going to see a kind of retrenchment of some of the incentives,” Collins said. “Public sentiment will shift as more people understand the costs of the fossil-fuel status quo.”