Pooled Income Fund
How It Works
- You transfer cash or securities to the Pooled Income Fund.
- The fund issues you units, like a mutual fund, and pays you (or up to two income beneficiaries you name) the annual income attributable to your units for life.
- The principal attributed to your units passes to Exeter at the passing of the last income beneficiary.
- Receive income for life in return for your gift.
- Receive an immediate income tax deduction for a portion of your gift to the Fund.
- Pay no capital gains tax on any appreciated assets you donate.
- Income can exceed dividends you were receiving on the securities you donated.
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Questions and Answers
A pooled income fund is invested to produce a reasonable income for all income beneficiaries who own units (or shares) in the fund. It works much like a mutual fund whereby a donor invests in the fund and the dollars invested by all the donors are pooled and invested in a common fund to produce income for all income beneficiaries depending on the number of units (or shares) they own in the fund.
Absolutely! You can make additional contributions to your pooled income account at any time, and thereby increase the number of units you own in the fund which will increase your income.
Gifts of cash or securities to a pooled income fund produce the same result as to the income and charitable deductions you will receive. However, gifts of appreciated securities have the additional benefit of avoiding capital gains taxes.