Pooled Income Fund Summary Report

[Kathleen Reynolds]

#4669

The fair market value of a remainder interest in property transferred to a pooled income fund is the value of the property contributed (the value is determined under Treasury Reg. §1.642(c)-6(a)(1)). The program selects a remainder factor that is determined by the number of lives and the transfer date that is used. (The Charitable Financial Planner handles one to five lives.) These factors may be found in the IRS Publication 1457, Actuarial Values Alpha Volume for transfer dates after April 1989 and IRS Publication 723D for transfer dates prior to May 1989.

If the yearly rate of return is a percentage that is between those rates for which returns are provided in the table, a linear interpolation is required. The present value of the remainder interest is determined by multiplying the remainder factor times the fair market value of the property contributed.

• Highest Rate of Return for Three Preceding Years: This number is imported from the input field section of this calculation. It is the highest rate of return earned by the fund in any one of the three years preceding the year of the contribution.
• Remainder Factor: This factor changes depending on the number of lives used for this calculation.
• Charitable Deduction for Remainder Interest: The dollar amount of the property value that is not subject to taxation (income tax). The present value of the remainder interest is determined by multiplying the remainder factor times the fair market value of the property contributed. The fair market value of a remainder interest in property transferred to a pooled income fund is the value of the property contributed.
• Donor’s Deduction as Percentage of Property Transferred: The percentage amount of the property value that is not subject to taxation (income tax).

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