Reminiscent of donor-advised funds, the Internal Revenue Service has ruled that contributions can qualify as charitable deductions for both income and gift tax purposes even if the donor retains the right to manage the investment for the charity.
Under the facts in Ltr. Rul. 200445023, an individual and a limited liability company propose to make donations of cash and traded securities to a tax-exempt college that agrees to place the donations in investment or brokerage accounts and permit the donors to manage the investments under a limited power of attorney.
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