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Pooled Income Funds May Make a Comeback in 2015

Pooled Income Funds May Make a Comeback in 2015

Next year may be an opportune time to promote gifts to a pooled income fund (PIF)!  That’s right. The planned giving vehicle that most charities have mothballed for the last 20 years may be poised for a comeback.  Why?  Read on. In 2015, the charitable deduction for a gift to a pooled income fund less than three taxable years old will be the highest it has ever been. That is because the deduction for gifts to a “young” fund is based on an assumed valuation rate provided by the IRS, rather than a rate based on the fund’s own net income earning experience. This valuation rate will be just 1.2% in 2015, the lowest it has ever been, and that means that deductions for gifts to young PIFs in 2015 will be the highest they have ever been.

PG Calc Insights: IRS Releases Latest Statistics on Planned Gifts

The IRS recently published its latest statistics on split interest trusts - charitable remainder trusts (CRTs), charitable lead trusts (CLTs), and pooled income funds (PIFs). The statistics are based on the information reported on Form 5227s filed during calendar year 2011, so they largely reflect 2010 activity. The IRS also has released a paper that analyzes these statistics and provides substantial additional detail about these gift plans.   You can see the statistics and the papers for yourself by going to the IRS site. The rest of this post highlights some of the very interesting information I have gleaned from there.

IRS Split Interest Trust Statistics (based on 5227s filed in 2011)

The IRS has released statistics for charitable remainder unitrusts (CRUT), charitable remainder annuity trusts (CRAT), charitable lead trusts (CLT), and pooled income funds (PIF) based on Form 5227s filed in 2011. This means that the information largely reflects values as of the end of 2010. Some pertinent statistics are summarized in the table below, including the change of each value from 2010’s 5227s to 2011’s 5227s.