A pooled income fund is an irrevocable trust established and maintained by a public charity to which many donors can make contributions. Generally, it works as follows:
" Contributions received from individual donors are commingled for investment purposes.
" Each year, the donor (or the donor's designated income beneficiary) receives a distribution in an amount equal to the donor's pro rata share of the fund's net investment income.
" At the death of the income beneficiary, the portion of the fund attributable to the donor's gift is severed from the fund and distributed to a charity or charities of the donor's choice.
In the year of contribution, the donor may be entitled to an income tax charitable deduction.
Contributions are treated as gifts to a public charity for purposes of the income tax deductibility limitations.
The pooled income fund may accept appreciated assets from a donor and sell the appreciated property without the donor incurring immediate recognition of capital gains. If the property is encumbered by debt, other rules apply. The gift to a pooled income fund qualifies for the charitable gift and estate tax deduction. However, gift or estate tax may be incurred if the income interest is payable to someone other than the donor or the donor's spouse.
A Wisconsin Pooled Income Fund with Declaration of Trust by Charitable Organization refers to a type of charitable fund established in the state of Wisconsin that allows individuals to contribute funds to a common pool, the income from which is distributed to individual beneficiaries. This arrangement offers donors a way to make a charitable contribution while also maintaining a stream of income during their lifetime. The Wisconsin Pooled Income Fund with Declaration of Trust by Charitable Organization is typically governed by a legally binding document called the Declaration of Trust. This document outlines the rules and regulations under which the fund operates, including the eligibility criteria for beneficiaries, investment strategies, and distribution procedures. It ensures that the fund is managed in accordance with state laws and regulations, as well as the specific wishes of the donors. There are several types of Wisconsin Pooled Income Funds with Declaration of Trust by Charitable Organization, each catering to different philanthropic goals and preferences. These include: 1. General Wisconsin Pooled Income Fund: This type of fund allows donors to contribute any type of asset, such as cash, stocks, bonds, or real estate, to the common pool. The fund's income is then distributed among beneficiaries, who may include the donors themselves, their family members, or other individuals designated by the donors. 2. Restricted Wisconsin Pooled Income Fund: This variant enables donors to restrict the use of their contributions to specific charitable causes or organizations. For example, a donor may choose to support education, healthcare, or environmental conservation through their contributions. The income generated by the fund is then distributed to beneficiaries who align with the chosen charitable cause or organizations. 3. Donor-Advised Wisconsin Pooled Income Fund: This type of fund allows donors to have a say in the selection of charitable organizations or causes that will receive distributions from the income generated by the fund. Donors can actively participate in recommending grants to specific charities or projects, offering them greater involvement and participation in the philanthropic process. 4. Flexible Wisconsin Pooled Income Fund: This type of fund provides donors with the flexibility to add additional contributions to the fund over time. It allows donors to contribute more assets or cash in subsequent periods, giving them the opportunity to increase their impact and continue supporting charitable causes on an ongoing basis. Overall, a Wisconsin Pooled Income Fund with Declaration of Trust by Charitable Organization offers donors a tax-efficient way to make charitable contributions while maintaining an income stream during their lifetime. It ensures the proper management and distribution of funds according to the donors' intentions, making a meaningful impact on the chosen charitable causes or organizations.
