Charitable Remainder Unitrust
You may be concerned about the high cost of capital gains tax with the sale of an appreciated asset. Perhaps you recently sold property and are looking for a way to save on taxes this year and plan for retirement. A charitable remainder unitrust might offer the solutions you need!
For example, a married couple had a larger than normal income for the current year due to an IRA withdrawal, which created an excessive tax liability. Due to the large tax bill, they considered selling stock, but the capital gain would create an additional tax. They had also hoped to use the stock to generate income for their retirement years. By transferring the stock to a Charitable Remainder Trust (CRT) established for the benefit of Noah Homes, they avoided paying the capital gains tax, invested the entire sale proceeds within the CRT to generate income for their retirement, and received a charitable income tax deduction that was used to greatly reduce the tax liability on the original IRA withdrawal.
Benefits of a charitable remainder unitrust
- Receive income for life, for a term of up to 20 years or life plus a term of up to 20 years
- Avoid capital gains on the sale of your appreciated assets
- Receive an immediate charitable income tax deduction for the charitable portion of the trust
- Establish a future legacy gift to our organization
How a charitable remainder unitrust works
- You transfer cash or assets to fund a charitable remainder unitrust.
- In the case of a trust funded with appreciated assets, the trust will then sell the assets tax-free.
- The trust is invested to pay income to you or any other trust beneficiaries you select based on a life, lives, a term of up to 20 years or a life plus a term of up to 20 years.
- You receive an income tax deduction in the year you transfer assets to the trust.
- Our organization benefits from what remains in the trust after all the trust payments have been made.
There are many ways to give. Contact us to discuss your unique needs and desires.
Charitable remainder unitrust for income. A charitable remainder unitrust pays you income that reflects the value of the trust's assets. Your income has the potential to increase over time as the trust grows in value.
How to select the right unitrust payout. There are several unitrust payout options to meet your needs. The best payout option may depend on the nature of the asset used to fund the trust. We would be happy to work with you and your tax advisor to determine which payout option is best for you.