The Discussion

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 o Sell highly appreciated assets and avoid capital gains tax

o Create substantial income tax deductions

o Create a lifetime income stream for you and/or your posterity

o Leave a legacy to charities of your choice

This sounds too good to be true, how can this be done?

Have your CPA look it up!

A Pooled Income Fund is a tax-exempt trust has been sitting in the IRS Code [1.642 (c)-6] since 1969. 

Due to low interest rates, tax deductions are high.

A ‘PIF’ acts like a mutual fund, in that individuals “pool” assets into the trust and receive deductions and a substantial income stream in return. Assets gifted into the trust are irrevocable and ultimately go to the charity(ies) of your choice.

Joan and John, both 57, had appreciated stocks they wanted to diversify for safety and to generate income from. However, they didn’t want to sell the stocks because it would be too costly in taxes. 

After examining all of their options, they decided to utilize the trust and donated $100,000 worth of appreciate stock value into the Pooled Income Fund. Their original cost basis was $20,000.

Through their donation, they received a deduction of 66% ($66,400) against income, an avoidance of $80,000 of capital gains, a total tax savings of $55,114, and a lifetime income of $6,000/ year.

Now, Joan and John are enjoying the benefits of extra income, a much-needed tax break, and they feel good knowing that the funds will eventually benefit causes close to their heart.