The past few years have exposed a lot of needs in our communities, and many of us feel even more compelled to give back what we can. It seems more important now than.
Charitable Lead Trusts and Charitable Remainder Trusts.Planners use an annuity approach, with a fixed dollar amount payable to an annuity recipient each year, or unitrust structure, with a fixed percentage of trust assets being payable each year during a set term.
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By Margaret Gibson, Katz Teller
A Charitable Lead Trust (CLT) is a valuable estate planning tool (under current law) for charitably inclined business owners who may also benefit from an income tax deduction to offset earnings from a sale of their business or from a successful year.
A CLT allows the grantor to make annual gifts to charity while effectively transferring wealth to heirs largely free of estate and gift taxation. This irrevocable trust is designed to distribute an annual income interest (the lead interest) to at least one qualified charity for a period measured by a fixed term of years or the lives of one or more individuals. At the end of the term, the balance of the trust assets (the remainder interest) is distributed to non-charitable beneficiaries, such as the family members of the grantor (or typically a trust for their benefit).