Contents

§ 13.1 DEFINITIONSPOOLED INCOME FUNDSThe rules concerning qualified pooled income funds employ a variety of definitions,which include the following:• The term income has the same meaning as it does under general incometax rules. 5• The term donor includes a decedent who makes a testamentary transfer ofproperty to a pooled income fund. 6• The term governing instrument means either the governing plan underwhich the pooled income fund is established and administered or theinstrument of transfer, as the context requires. 7• The term public charity means certain charitable organizations that are notprivate foundations because they are institutions such as churches, universities,colleges, and hospitals, or are certain publicly supported charities.8 To be a public charity for these purposes, an organization need onlybe described in one of the applicable provisions of the federal tax law, 9even though it has been classified as another type of public charity. 10Nonetheless, not all charitable organizations that are generically termedpublic charities qualify as such under these rules.• The term fair market value, when used with respect to property, means itsvalue in excess of the indebtedness or charges against the property. 11• The term determination date means each day within the tax year of a pooledincome fund on which a valuation is made of the property in the fund. Theproperty in the fund must be valued on the first day of the tax year of thefund and on at least three other days within the tax year. The periodbetween any two consecutive determination dates within a tax year may notbe greater than three calendar months. In the case of a tax year of less than12 months, the property in the fund must be valued on the first day of thattax year and on such other days within the year as occur at successive intervalsof no greater than three calendar months. When a valuation date fallson a Saturday, Sunday, or legal holiday, 12 the valuation may be made oneither the next preceding day that is not a Saturday, Sunday, or legal holiday5 Reg. § 1.642(c)-5(a)(5)(i). The term income is generally defined in IRC § 643(b). See §§ 13.8, 10.13.6 Reg. § 1.642(c)-5(a)(5)(ii).7 Reg. § 1.642(c)-5(a)(5)(iii).8 Reg. § 1.642(c)-5(a)(5)(iv).9 IRC § 170(b)(1)(A)(i)–(vi).10 Reg. § 1.642(c)-5(a)(5)(iv). For example, a charitable organization may not be a private foundation by reasonof the fact that it is classified as a publicly supported charity under IRC § 509(a)(2), and yet also satisfy thepublic support test of IRC § 509(a)(1). Because of this, the organization is one that is described in IRC §170(b)(1)(A)(vi) and thus qualifies as a public charity under these rules. By contrast, if the organization satisfiedonly the IRC § 509(a)(2) public support test, and not the IRC § 509(a)(1) public support test, it would notbe a public charity under this definition (unless it otherwise qualified), because IRC § 509(a)(2) is referencedin IRC § 170(b)(1)(A)(viii), which is outside the scope of the tax law provisions defining public charities inthis context. In general, see § 3.4.11 Reg. § 1.642(c)-5(a)(5)(v).12 The term legal holiday is defined in IRC § 7503. 478