CHARITABLE REMAINDER TRUSTS
Donors who wish to generate income from an asset while ultimately gifting it to charity can establish a Charitable Remainder Trust (CRT). This type of structured giving vehicle is particularly advantageous for highly appreciated assets.
The donor contributes the asset to an irrevocable trust — one in which the terms of the trust cannot be amended or revised until the terms or purposes of the trust have been completed — and names the charity or charities that will ultimately benefit. The donor can claim an immediate income tax charitable deduction for the value that will ultimately pass to charity, and can defer the payment of capital gains taxes on the appreciation.
The donor or other beneficiary receives specified distributions from the trust, either for a specific number of years or for their lifetime. At the end of that term or the beneficiary’s life, the remaining assets pass to the charity that the donor has named.
This material has been provided for general informational purposes only and does not constitute either tax or legal advice. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a tax preparer, professional tax advisor, or lawyer.
The donor contributes the asset to an irrevocable trust — one in which the terms of the trust cannot be amended or revised until the terms or purposes of the trust have been completed — and names the charity or charities that will ultimately benefit. The donor can claim an immediate income tax charitable deduction for the value that will ultimately pass to charity, and can defer the payment of capital gains taxes on the appreciation.
The donor or other beneficiary receives specified distributions from the trust, either for a specific number of years or for their lifetime. At the end of that term or the beneficiary’s life, the remaining assets pass to the charity that the donor has named.
This material has been provided for general informational purposes only and does not constitute either tax or legal advice. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a tax preparer, professional tax advisor, or lawyer.