Charitable Remainder Trust
When a you create a Charitable Remainder Trust you can receive income from the trust. There are two types of Charitable Remainder Trusts:
Unitrust – Your income varies as the value of the trust changes. You receive payments each year, determined by multiplying a fixed percentage that you choose (say 7%) by the fair market value of the trust’s assets as valued each year. As your investments grow, so does your income; but if your investments decrease in value, your payout does also.
Annuity Trust – Your incomes remains constant because it is based on a fixed percentage of the initial fair market value of the assets funding the trust.
You can fund a trust by donating a variety of assets: closely held stock, real estate, art, or even payments from retirement plans. If it is a Unitrust, you can add assets at any time. It is also possible to designate multiple beneficiaries and to change those beneficiaries at any time during the course of the trust.
By setting up a Charitable Remainder Trust, you can:
- Turn highly appreciated assets into a diversified source of income without selling them and paying the capital gains tax.
- Receive an immediate income tax deduction.
- Collect payments from the trust for life or for a specified term.
For any questions you may have on a Charitable Remainder Trust, please contact us. We will be glad to help you.
Tim Bowman
Financial Planning Officer
Indiana Wesleyan University
4201 S. Washington Street
Marion, Indiana 46953
tim.bowman@indwes.edu
(765) 677-2466
Brian Lewis
Director of Estate Planning and Planned Giving
Indiana Wesleyan University
4201 S. Washington Street
Marion, Indiana 46953
brian.lewis@indwes.edu
(765) 677-2466
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