For High-Net-Worth Individuals and Entities

High-net-worth individuals and entities can recognize significant financial and philanthropic benefits by contributing cash or appreciated assets to a specially designed “pooled income fund” (PIF). Generally, a PIF is a trust maintained by a public charity that pays lifetime income to individuals selected by the donor, with the remainder going to the public charity. PIFs have been around for over 50 years and are allowed under Internal Revenue Code Section 642(c).

Generally, a PIF works as follows:

• The donor contributes cash, securities, or other approved property to the PIF.
• he donor selects his/her PIF income beneficiaries, who are individuals. For an entity, this means one or more of the entity’s key employees.
• The charity controls the donated assets and invests them to generate income.
• The PIF income beneficiaries receive the PIF’s income at least annually for life, in the order selected by the donor.
• After all of the donor’s PIF income beneficiaries die, the remainder of the donor’s PIF contribution goes to the charity for its use.

The benefits of a traditional PIF are:

• An immediate charitable contribution deduction.
• No capital gains taxes on donated appreciated property.
• PIF income beneficiaries receive income for life.
• The donor ultimately benefits the public charity sponsoring the PIF.
• Simplicity. No donor compliance or tax filings related to the PIF.

The benefits of a specially designed FGI PIF are:

• A larger charitable contribution deduction than a traditional PIF.
• The PIF can accept and invest in a broader range of assets.
• The PIF allows a broader group of income beneficiaries than a traditional PIF, including younger beneficiaries. (Selecting younger beneficiaries lower the charitable contribution deduction but greatly increases the amount of income paid, due to their longer life expectancy.)
• PIF assets are invested to generate higher current income than most traditional PIFs.
• The donor may recommend to FGI its preferred public charities to receive the PIF remainder, helping fulfill the donor’s long-term philanthropic goals.
• The PIF can be limited to a targeted group.

FGI assists in determining if a specially designed PIF will is appropriate for the donor, and how best to maximize the PIF benefits. (Minimum funding levels and upfront fees will apply.)