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CHARITABLE REMAINDER UNI-TRUST

What is the purpose of a charitable remainder annuity trust?

A Charitable remainder annuity trust, aka CRAT, allows a grantor/settlor to create an irrevocable trust that generates Income and offers tax benefits until the beneficiary dies. Once the beneficiary dies, the CRAT transfers the remaining trust assets to the charity of charities of choice. Regarding income tax deduction, our recommendation is to set up a meeting with our managing partner, Jillyn Hess-Verdon, to go over your philanthropic goals and topics like charitable deduction, partial tax deduction, trust assets, and projected income payments, and more.

A CRUT makes annual payments to beneficiaries during the donor’s life, and when they die, the remainder of the trust goes to a charitable cause. The payment to beneficiaries is calculated as a fixed percentage of the assets reaming in the trust. During the trust’s lifetime, the owner can top up the assets as they please.

There are various charitable remainder unitrusts, including a standard unitrust, a net income Unitrust, and a Flip Unitrust. The payment to beneficiaries depends on the type of CRUT created.

Advantages of CRUT

• Assets can be added to the entity over time.
• Highly valued assets can be sold with minimal tax consequences. Provides income stream for many years.
• The donor or beneficiaries can claim tax charitable deductions.

A charitable remainder uni-trust is an irrevocable trust. Learn the pros and cons of a charitable trust.

Is Income Received from a CRUT taxable?

A charitable remainder trust is a tax-exempt irrevocable trust which can provide income streams for both the donor and beneficiaries while also donating funds to charities. The trust is irrevocable and cannot be modified or terminated by heirs without their permission.

Are you planning to use gift vehicles in your estate planning?

With an estate planning attorney’s help, you can set up charitable trusts and gifts of annuities. Charitable giving is a fantastic estate planning tool; these gift vehicles allow you to donate to the charities of your choosing, reduce your tax burdens and receive dependable Income for life.

How long can a CRUT last?

Charitable remainder trust (CRUT) pays the beneficiary a fixed portion of the trust every year, sometimes for life or 20 years.

What is the difference between a CRAT and a CRUT?

A charitable remainder annuity trust or CRAT provides Income for a fixed dollar sum, while a charitable remainder unitrust or CRUT provides Income as a fixed percentage.

Learn the Different Types of Charity Trusts

Hess-Verdon is in Newport Beach, California. We have 30 years of experience in advance estate planning law, especially in charitable remainder Unitrust, charitable remainder annuity trusts, and the umbrella topic of charitable remainder trust. We have helped many clients protect their estate, grow it, and pass it down to their loved ones through various legal instruments.

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