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Charitable Trusts

Charitable Remainder Trusts

Charitable remainder trusts provide you with both income and certain tax benefits for a portion of your gift.

Through a charitable trust, a donor makes an irrevocable transfer of property — cash or other assets — to a trust, which is invested and managed by a professional financial institution of the donor’s choice, producing income for the donor or other beneficiary, either for a fixed period of time up to twenty years or until the donor or other beneficiary dies. At the conclusion of the trust period, the remaining principal assets will be distributed to the Foundation.

–       Charitable Remainder Annuity Trusts

A charitable remainder annuity trust will furnish you — or someone you designate — with a fixed annual income for life or for a pre-determined number of years (up to twenty). The payment amount — which you would determine when you establish the trust — must be at least five percent of the initial gift amount. That amount will not change over the life of the trust. This will appeal to those who want the security of a regular amount each year.

When the trust is created, you may claim a charitable deduction based on the value of the asset used to establish the trust.

–       Charitable Remainder Unitrusts

A charitable remainder unitrust provides annual payments that will fluctuate from year to year, based on the earnings of the investments in the trust. When the trust is created, you select the fixed payout percentage, which must be at least five percent of the initial gift amount. The annual payment is based on a percentage of the trust’s value as calculated each year.

When the trust is created, you may claim a charitable deduction based on the value of the asset used to establish the trust.

Charitable Lead Trusts

Charitable lead trusts appeal to individuals who wish to make a gift but retain the property. These irrevocable trusts are, essentially, the reverse of charitable remainder trusts in that the payments from a charitable lead trust will first come to the Foundation for a specific period of time, usually between 10 and 20 years, after which time the principal of the trust will revert to you and/or to those you have designated, typically your children or grandchildren.