The Myriad Benefits of a Charitable Remainder Trust
For many people, the appeal of a charitable remainder trust – which provides lifetime income to you and, after your lifetime, supports our good work – lies in its ability to work under a variety of circumstances. Following is a description of how this life income gift works.
How a Charitable Remainder Trust Works
- A charitable remainder trust pays a flow of income to you and anyone else you name, typically for your lifetimes.
- With the help of your estate planning attorney, you create the trust with assets of your choosing, and you decide how much it will pay you, within limits set by the IRS.
- You choose between two types of charitable remainder trusts. The most common is a unitrust, which pays you a variable amount based on a percentage of the trust assets as revalued each year. An annuity trust pays you a fixed sum each year.
- At the end of the trust term, the remaining assets inside the trust support Hindu Heritage Endowment.
How You Benefit
- When you itemize your tax deductions, you receive an income tax charitable deduction for a portion of the fair market value of the assets placed in the trust.
- When you fund the trust with capital gain property, such as appreciated securities or other property owned for more than one year, you are not taxed up front on the capital gain. Your deduction is based in part on the full fair market value – not the lower cost basis.
- If you – or you and your spouse – are the only income recipients, the trust’s value will not be taxable for federal estate tax purposes.
- You will be making a difference in the lives of those we serve.
Contact us – at no obligation – if you would like to review the specifics of a charitable remainder trust. You can also find more online.