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Young Pooled Income Fund

Your youngest clients
have the most to gain.

A 35-year-old founder with a concentrated position has 50 years of compounding ahead of them. A Young Pooled Income Fund captures all of it — eliminating capital gains, generating lifetime income, and reinvesting every tax advantage from day one.

See How It Works Run the Numbers
Glass tower reaching skyward — the architecture of institutional ambition
Capital gains avoided
100%
No immediate recognition on contribution — the full position goes to work
Deduction advantage
Larger than a seasoned PIF
The "young" designation triggers the IRS deemed rate — not the fund's actual yield — producing a superior deduction
Lifetime income
For the donor's life
Pro-rata share of fund earnings, paid for the donor's lifetime — replacing the income that disappeared at exit
Advisors analyzing real-time financial data — the intelligence behind modern planning
Digital financial data visualization — growth trajectories in the modern economy
The opportunity

The earlier the contribution,
the longer the compounding.

A founder who exits at 35 with $8 million in appreciated stock faces a decision most planning structures aren't built for. They have decades of income ahead to replace, a concentrated position they need to diversify, and a philanthropic identity they want to build — all at once.

A Young Pooled Income Fund is purpose-built for this moment. The full position enters the fund without triggering capital gains. The fund diversifies and invests — with 100 cents on the dollar working from day one. The donor receives lifetime income. And because the fund is new, the IRS deemed rate produces a charitable deduction that is systematically larger than an established fund would generate.

"The Young Pooled Income Fund is the structure that exists for exactly this client — and most advisors have never presented it."

Three advantages, one structure, administered entirely by GiftingNetwork. The only variable is time — and for a 35-year-old, there's plenty of it.

Scenario: $8M position, 5% basis, age 35
Fair market value $8,000,000
Cost basis $400,000
Embedded gain $7,600,000
Taxable sale — CG tax (23.8%) −$1,809,000
Net investable after sale $6,191,000
Young PIF — capital deployed $8,000,000
Young PIF contributes the full position with no immediate gain recognition. That $1.8M stays invested and compounds for the donor's lifetime — 50+ years for a 35-year-old.
How it works

Four advantages.
One structure.

A Young Pooled Income Fund is not a DAF, a CRT, or a foundation. It is its own vehicle — engineered for donors with appreciated, concentrated positions who need income, want to give, and can extend that income to the next generation.

01
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Capital gains eliminated

The donor contributes appreciated stock directly to the fund. The fund sells the position and diversifies — with no capital gains recognition to the donor. The full fair market value goes to work immediately.

This is the same advantage as a DAF — but in a Young PIF, it's just the beginning.

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02

Charitable deduction sized for the donor's advantage

The donor receives a deduction for the present value of the charity's remainder interest. In a Young PIF, because the fund has no 3-year earnings history, the IRS mandates use of a deemed rate — not actual yield.

In the current rate environment, this produces a larger deduction than an established fund would generate. Both the deduction savings and the CG advantage are reinvested from year zero.

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03

Lifetime income from 100 cents on the dollar

The donor receives their pro-rata share of the fund's actual earnings for life. Because 100 cents — not 77 cents after tax — is invested, the income base is permanently larger than the taxable alternative.

For a 35-year-old founder, this advantage compounds over 50+ years. But the income doesn't have to stop with the donor.

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04

Children named as additional income beneficiaries

A Young PIF can designate multiple income beneficiaries — including the donor's children. A parent age 55 and two children age 25 and 28 can all receive income from the same fund, extending the cash flow stream by decades beyond the donor's own life expectancy.

The remainder factor — and the deduction — reflects the youngest beneficiary's life expectancy. This meaningfully increases the charitable deduction while creating a multigenerational income vehicle that no other charitable structure replicates at this cost and simplicity.

The technical edge

Why "Young" changes everything.

The IRS requires pooled income funds to calculate the charitable deduction using a remainder factor — essentially the present value of what the charity will eventually receive.

An established fund uses its own 3-year average earnings rate to calculate this factor. A Young PIF — one without that earnings history — must use the IRS deemed rate: 120% of the AFR midterm rate.

This is not a loophole. It is the explicit IRS rule under IRC §642(c)(5). And in the current rate environment, it produces a systematically larger deduction than an established fund would generate for the same contribution.

The effect is straightforward: the deduction savings — which are reinvested at the portfolio return rate alongside the CG tax avoided — start from a higher base. Over 30, 40, or 50 years of compounding, the difference is substantial.

For your practice: Most advisors have never encountered a Young PIF because the vehicle is administered by community foundations and planned giving organizations — not by the custodians and platforms that supply most advisor product shelves. GiftingNetwork bridges that gap.

Deduction calculation — Young PIF vs. established PIF
FMV contributed $5,000,000
Donor age 35
Life expectancy (IRS table) ~47.7 years
Established PIF rate (hypothetical 5.5%) Remainder factor: 7.3%
→ Charitable deduction ~$363,000
Young PIF IRS deemed rate (3.2%) Remainder factor: 22.4%
→ Charitable deduction ~$1,120,000
Deduction advantage +$757,000

Illustrative. Actual deduction depends on IRS-published deemed rate at time of contribution, donor age, and fund elections. Consult qualified tax counsel.

Who it's for

Built for the advisors who
are already in the room.

The Young PIF conversation happens at a liquidity event — and the advisors who succeed with this vehicle are the ones present at that moment.

VC-Affiliated Wealth

VC-affiliated wealth management arms

VC-affiliated wealth management arms are building family-office capability for founders post-IPO or M&A — exactly the profile the Young PIF is designed for.

  • Clients have near-zero basis positions from founder equity
  • Charitable intent is often present but unstructured
  • Income need is real — the salary just ended
  • CRT is too complex; DAF doesn't pay income
Relevant firms
Founder liquidity eventsPost-IPO equityM&A proceeds
Independent RIAs

RIAs serving tech executives & entrepreneurs

Independent RIAs serving tech executives and entrepreneurs work with clients whose wealth came from RSUs, options, and business exits. Many have held appreciated positions for years and face the same tax wall.

  • Long-tenured tech employees with large RSU accumulations
  • Business owners who sold and held stock in the acquirer
  • Inherited concentrated positions with near-zero inherited basis
  • Donors in their 50s and 60s who want to add children as income beneficiaries — extending cash flow by decades
  • Advisors who want to deepen planned giving conversations
Relevant firms
RSU & option holdersBusiness exit proceedsConcentrated positionsTech executives
Estate & Tax Practitioners

Estate attorneys & tax advisors at liquidity events

M&A attorneys, CPAs, and estate planners who are present at the moment of transaction are often the first to surface the concentration problem — and the last to have a charitable income solution ready.

  • Pre-sale contribution structures for closely-held business owners
  • Post-sale planning for executives with lock-up expirations
  • Estate planning for inheritors of large concentrated positions
  • Integration with existing trust and estate structures
Trigger events
IPO lock-up expiry M&A close Estate settlement Tender offer
A new generation of financial advisors — collaborating, thinking forward
The numbers

See the advantage
for your client's situation.

Adjust the inputs to match your client's profile. All three return tranches are shown — with deduction savings and CG tax avoided reinvested and compounded from year zero.

Young PIF — Total return vs. taxable sale & invest Illustrative only — not tax advice
CG tax avoided (compounded)
—
—
Deduction savings (compounded)
—
—
Income advantage
—
100¢ vs. after-tax base
Total Young PIF advantage vs. taxable sale
—
—
Young PIF (all tranches)
Taxable sale + invest

Assumes 8% total portfolio return. CG rate 23.8% (federal). Dividend yield 4.5%, qualified dividend tax treatment. Deduction savings and CG tax avoided reinvested at year 0 and compounded at portfolio return. Life expectancy interpolated from IRS Publication 1457 Table V. This is illustrative and does not constitute tax, legal, or investment advice.

How we work together

You bring the client.
We handle everything else.

01

You identify the opportunity

A client with a concentrated position, charitable intent, and an income need. You recognize the profile and initiate the conversation — or GiftingNetwork can provide educational materials to share directly.

02

We prepare the analysis

GiftingNetwork produces a client-specific illustration showing all three return tranches — capital gains avoided, deduction savings, and lifetime income advantage — modeled to their exact situation.

03

Your client's counsel reviews

We work alongside the client's tax attorney and CPA to document the contribution, structure the investment strategy, and ensure the deduction is properly supported. We coordinate — you don't have to.

04

The fund is established and administered

GiftingNetwork establishes and administers the pooled income fund through our institutional sponsor network. Income distributions are handled quarterly. You remain the advisor of record for the client relationship.

05

Your client gives with purpose

When the last income beneficiary passes, the fund remainder flows first to GiftingNetwork's institutional sponsor — most typically into a donor-advised fund held at that sponsor. From there, grants can be directed to any qualifying public charity the donor's family designates. Many clients use this structure as the cornerstone of a multigenerational philanthropic legacy, with the sponsor DAF serving as a permanent charitable endowment.

What GiftingNetwork provides
📊
Client-specific modeling

Detailed illustrations for any donor profile — age 25 to 80, any position size, any basis percentage. Branded with your firm if desired.

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Institutional fund administration

Full back-office administration through our network of community foundation and institutional sponsors. No operational burden on your firm.

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Investment strategy support

High qualified dividend and dividend capture strategies executed within the fund. Advisors may retain discretion over fund investments in certain structures.

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Tax documentation

All deduction substantiation, K-1 preparation, and income reporting handled by our team. Coordinated directly with the client's CPA.

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Referral relationship maintained

You stay the advisor. GiftingNetwork is the administrator. The client relationship — and the asset — stays with you.

About GiftingNetwork

The infrastructure behind
institutional philanthropy.

GiftingNetwork is a donor-advised fund infrastructure platform serving institutional sponsors — community foundations, Jewish federations, healthcare system foundations, and religious organizations — alongside their financial advisor networks.

Our platform operates as a three-sided marketplace connecting nonprofit DAF sponsors, financial advisors, and donors. Key partnerships with Orion Advisor Solutions and Envestnet provide access to approximately 200,000 financial advisors across the country.

GiftingPension represents our dedicated channel for the Young Pooled Income Fund — bringing a vehicle that has historically lived inside the planned giving community to the financial advisors and wealth managers who are present at the liquidity events where it matters most.

Structurally, GiftingNetwork's institutional sponsors serve as the first remainderman of every Young PIF we administer. When the last income beneficiary passes, the fund remainder flows into a donor-advised fund held at the sponsoring organization — from which the donor's family can recommend grants to any qualifying public charity over time. This sponsor DAF structure preserves maximum flexibility for the donor's philanthropic intent while satisfying the statutory requirements of IRC §642(c)(5).

We compete alongside — and collaborate with — community foundations in making the Young PIF accessible to a new generation of donors: younger, wealthier, and more likely to engage with philanthropy as a financial planning tool than as a simple gift.

Strategic perspective — looking beyond the horizon at what impact can become
200,000+
Financial advisors in our distribution network via Orion and Envestnet
3-sided
Marketplace: sponsors, advisors, and donors — all on one platform
50+ yrs
Maximum projection horizon for a 35-year-old donor — the full benefit window
IRC §642
The explicit statutory authority for the Young PIF's deemed rate advantage
Resources

Everything your team needs
to understand the Young PIF.

Educational guides for financial advisors, estate attorneys, and wealth managers — from the mechanics of IRC §642 to practical planning scenarios for younger donors.

Mechanics

The Advisor's Complete Guide to the Young Pooled Income Fund

A plain-English walkthrough of how a Young PIF works, why the "young" designation produces a larger deduction, and how to identify clients for whom this structure is the right fit. Includes worked examples at multiple age and position-size combinations.

This is the starting point for any advisor new to the vehicle. Read this first, then share the illustrations with your client.
GUIDE — 12 min read
  • What is a Pooled Income Fund?
  • Why "Young" changes the deduction calculation
  • The three return tranches explained
  • Client profile: who qualifies and who doesn't
  • IRC §642(c)(5) — the statutory authority
  • How the fund is administered
  • Comparing the Young PIF to a CRT
GiftingNetwork Read guide →
Planning

Planning for the 35-Year-Old Founder: A Young PIF Case Study

A detailed walkthrough of a founder liquidity event at age 35 — $8 million in stock, near-zero basis, no current income. How the Young PIF compares to a taxable sale across a 50-year projection, with all three tranches modeled.

Case study — 8 min read Read →
Comparison

Young PIF vs. Charitable Remainder Trust: Which Is Right for Your Client?

A side-by-side comparison of the two most powerful charitable income structures — covering administration complexity, investment flexibility, deduction sizing, income character, and the scenarios where each wins.

Comparison — 7 min read Read →
Strategy

High Qualified Dividend vs. Dividend Capture: Choosing the Young PIF Investment Strategy

The fund's investment strategy determines the character of lifetime income distributions. This guide covers both approaches — qualified dividend and dividend capture — and which client profiles favor each.

Strategy — 6 min read Read →
Planning

Young Donors with Children: How the Young PIF Anchors a Multigenerational Charitable Plan

For founders and executives who want to build a philanthropic legacy alongside wealth transfer planning, the Young PIF can serve as the cornerstone — generating income now and directing substantial assets to charity at death.

Planning — 9 min read Read →
Mechanics

IRC §642(c)(5) and the Deemed Rate: The Statutory Foundation of the Young PIF Advantage

For tax practitioners who want to understand the exact IRS authority behind the Young PIF deduction calculation — including how the deemed rate is set, how it interacts with AFR, and what triggers the "young" designation.

Technical — 10 min read Read →
Frequently asked questions

What advisors ask us first.

What is the minimum contribution size?
There is no universal minimum, but the structure is most economically efficient for contributions of $1 million or more. Below that threshold, the administrative costs begin to erode the net advantage. Most of GiftingNetwork's clients contribute between $2 million and $20 million.
What assets can be contributed?
A Young PIF typically accepts publicly traded securities — stock, ETFs, mutual funds. Closely-held stock, crypto, and real estate require additional structuring and sponsor approval. Contact us to discuss non-standard assets.
How long does "young" last?
A fund is considered "young" — and therefore uses the IRS deemed rate rather than actual earnings — until it has three full years of earnings history. After that, the deduction for new contributions is sized using the fund's actual 3-year average yield. GiftingNetwork manages this transition transparently.
Can the donor choose the charity?
Yes — with an important structural note. The first remainderman must be the fund's institutional sponsor — in GiftingNetwork's structure, this is typically a donor-advised fund held at the sponsoring organization. From there, the donor can recommend that grants flow to any qualifying public charity under IRC §170(b)(1)(A). Multiple charities can be designated for grant purposes, and the DAF wrapper at the sponsor gives the family ongoing flexibility to direct charitable distributions over time. This structure is more flexible than naming a single charity directly — it preserves optionality for the donor's philanthropic intent to evolve.
How is the income taxed?
Income distributions retain their character from the fund — ordinary income, qualified dividends, or a blend depending on the fund's investment strategy. Under the high qualified dividend strategy, the majority of distributions are taxed at preferential rates. The dividend capture strategy produces higher gross yield with partially ordinary income treatment.
What happens at the donor's death?
When the last income beneficiary passes, the fund remainder flows to GiftingNetwork's institutional sponsor — most typically into a donor-advised fund held at that sponsor. From there, the family can recommend grants to any qualifying public charity of their choosing. If the donor named adult children as co-beneficiaries, the income stream continues to surviving children before the remainder eventually reaches the sponsor DAF. There is no estate inclusion of the remainder interest and no probate. The DAF at the sponsor functions as a permanent charitable endowment — more flexible than naming a single charity directly at the time of contribution.
Do I lose advisory fees on the contributed assets?
Not necessarily. In certain fund structures, the advisor may retain discretion over the fund's investment strategy, maintaining the fee relationship. GiftingNetwork works with advisors on a case-by-case basis to structure the arrangement appropriately. Contact us to discuss your firm's specific situation.
Can children be named as income beneficiaries alongside the donor?
Yes — and this is one of the most underutilized features of the vehicle. A donor can name adult children as co-income beneficiaries, extending the cash flow stream beyond the donor's lifetime. The fund distributes income to all named beneficiaries for their respective lifetimes. Critically, the charitable deduction is calculated using the youngest beneficiary's life expectancy — meaning a 58-year-old parent who names a 30-year-old child receives a deduction equivalent to a much younger solo donor. This makes the Young PIF compelling well beyond the early-founder profile.
How does a Young PIF differ from a CRUT or CRAT?
A Charitable Remainder Trust is a separate trust created for a single donor — requiring trust drafting, separate tax filings, and ongoing trustee administration. A Young PIF is a pooled fund that GiftingNetwork administers on behalf of multiple donors, dramatically reducing cost and complexity. The pooling also means each donor's income is based on the fund's actual earnings — not a fixed percentage — which aligns with a well-managed investment strategy.

Your youngest clients
are waiting for this conversation.

Schedule a 20-minute call with the GiftingNetwork team. We'll walk through the mechanics, discuss your client profile, and model the numbers for a specific situation — including the full 50-year compounding picture for a younger donor.

We work with RIAs, VC-affiliated wealth managers, estate attorneys, and CPAs. No platform commitment required to explore.

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