Scott, the writer and former spouse of Amazon founder Jeff Bezos, has in two short years become one of the most generous U.S. philanthropists, giving away more than $12 billion of her now-$51.5 billion net worth. As Fortune reports in our April/May 2022 issue, she’s kept the operations of her giving machine mostly opaque. But we do know that one way she’s been able to ramped up so quickly is by routing her money through a type of charitable account called a donor-advised fund (DAF), rather a foundation (the strategy often employed by previous generations of billionaires). Scott has set up DAFs at three sponsoring financial institutions—the Chicago Community Trust, Fidelity Charitable, and the National Philanthropic Trust—the digital publication Puck reported in January.

She’s in good company. Donor-advised funds are an increasingly popular—and increasingly controversial—vehicle for wealthy tech entrepreneurs and other billionaires, as Fortune reported last month. They’ve been adopted by many of the country’s wealthiest philanthropists (who otherwise have some very different styles of giving), including Elon Musk, the Tesla CEO, new Twitter board member, and world’s wealthiest person; Bill Ackman, the activist investor and founder of Pershing Square Capital Management; Mark Zuckerberg, the founder and CEO of Facebook (now Meta); and Jack Dorsey, the founder of Twitter and Square (now Block). And they’re growing: In the 2020 fiscal year, contributions to DAFs increased by 21%, to $31.7 billion, the Chronicle of Philanthropy reported in late February.

As a specific type of charity-focused account administered by a larger financial institution, DAFs invest an individual’s assets until she’s ready to write a check, but avoid much of the overhead and bureaucracy that can come with creating a new organization. They’re relatively low-cost and easy to set up, even for donors well below the billionaire threshold. (For example, Fidelity—the largest DAF sponsor—has no minimum for individuals opening a charitable account, and says that its annual fees average out to about 1% of the balance.)

It’s worth noting, however, that DAFs are more opaque than private foundations, which are required to file annual tax forms disclosing their giving—and which are required by law to pay out at least 5% of their assets on an annual basis. In contrast, DAFs have no requirements to disclose their giving, and no deadlines for distributing the money they hold. (That creates a loophole for foundations, which sometimes skirt their disclosure and payout requirements by routing their money to DAFs.)

Donor-advised funds also provide significant tax advantages: Once a donor routes assets to a DAF, he or she can take immediate tax deductions against their income for the year the gift is made—but without any obligation or deadline to actually distribute it. This is one reason why some philanthropy experts have questioned the on-paper generosity of Elon Musk, who claimed late last year that he was facing an $11 billion-plus tax bill—and who in November donated Tesla shares worth about $5.7 billion “to charity,” without disclosing their ultimate recipients. The donation vaulted Musk up the ranks of top philanthropists, ranking him second on the Chronicle of Philanthropy‘s list of most generous 2021 donors—but no nonprofits have recently disclosed receiving any donations from Musk, and several experts have speculated that he merely moved the shares into DAFs. (Musk has not responded to requests for comment.)

A bipartisan bill now under consideration by Congress would put more restrictions on DAFs, by creating new types of accounts; one would provide upfront tax benefits only if deposits are paid out within 15 years, while another would give donors 50 years to distribute funds but would not provide upfront income-tax deductions.

Read more of Fortune‘s reporting about donor-advised funds, and Musk, here; read our full magazine profile of MacKenzie Scott here.