charitable remainder trust

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charitable remainder trust (Charitable Remainder Irrevocable Unitrust)

n. a form of trust in which the donor (trustor or settlor) places substantial funds or assets into an irrevocable trust (a trust in which the basic terms cannot be changed or the gift withdrawn) with an independent trustee, in which the assets are to go to charity on the death of the donor, but the donor (or specific beneficiaries) will receive regular profits from the trust during the donor's lifetime. The IRS will allow a large deduction in the year the funds or assets are donated to the trust, and the tax savings can be used to buy an insurance policy on the life of the donor which will pay his/her children the proceeds upon the donor's death. Thus, the donor (trustor) can make the gift to charity, make a return on his/her money and still arrange to make a large gift at death to his/her heirs. The disadvantage is that the assets are permanently tied up or committed.

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Transfers to donor-advised funds, supporting organizations, private foundations, charitable remainder trusts, charitable gift annuities, and pooled income funds are not qualified charitable distributions.
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The primary vehicles that come to mind for this are charitable remainder trusts, but those might not be accessible to clients who still need income, and wouldn't be comfortably wealthy after making that gift.
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Brown, A Primer on Charitable Remainder Trusts, Tax Mgmt.
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Charitable remainder trusts (CRTs) are similar to charitable gift annuities, but are established in the form of a trust, typically created with the help of an attorney.
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Charitable remainder trusts: Just as its name implies, a CRT pays an annuity or percentage amount (known as a unitrust, if the trust agreement calls for a percentage payout) to a designated beneficiary for a term of years (not to exceed 20) or the life of the beneficiary, with the remainder passing to a charity selected by the trust's settlor.
Coordinating charitable trusts and private foundations for the business owner: complying with UBIT and self-dealing rules
Such an inclusion--either in your will or through other types of legacy gifts such as charitable gift annuities, charitable remainder trusts, retirement plans, and/or life insurance policies that name the Historical Society of Michigan as a beneficiary--ensures that our state's past will continue to be preserved and promoted for years to come.
From the publisher
A less generous exclusion amount will act as a brake on such lifetime gifting techniques as charitable remainder trusts and charitable lead trusts.
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is pleased to announce that Florida Bar Board Certified Wills, Trusts & Estate Planning Attorney Eric Gurgold will co-present “The ABC's of Charitable Remainder Trusts Opportunities, Operations and Pitfalls,” for the Southwest Florida Community Foundation on Wednesday, November 28, 2012.
Gurgold to Co-Present ABC's of Charitable Remainder Trusts for Southwest Florida Community Foundation
What is a charitable remainder trust? How are charitable remainder trusts used as planning tools?
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