Charitable Giving

There are various methods to achieve your charitable giving goals. You may consider gifting strategies that provide income or assets (or both) to designated charities or family developed foundations prior to your passing or while very much alive and enjoying the current use of those assets. Charitable planning involves complex tax issues and other subsequent financial implications that should be discussed with a qualified tax, financial, or legal professional.

Charitable Remainder Trust (CRT)

A Charitable Remainder Trust enables the donor to transfer an asset while retaining the right to the income it generates. The asset becomes the “remainder” which is owned by the charity. Remainder trusts, if properly structured, can qualify for a current tax deduction.

  • Unitrust (CRUT): In a Unitrust, the annual income distribution that the donor receives is based on a predetermined percentage of the annual fair market valuation of the trust assets.
  • Annuity Trust (CRAT): In an Annuity Trust, the annual income distribution that the donor receives is a predetermined fixed amount.

Pooled Income Fund: Donors can pool their donated assets in a fund that is operated by the charitable organization. The donors then receive a proportionate share of income from the fund that is paid throughout their lifetime. Payments can vary each year based on the valuation of the underlying assets in the fund.
Charitable Lead Trust: Also known as an Income Trust. This trust vehicle transfers the income rights of the trust assets to the charitable organization. Generally, the income rights are assigned for a specified period of time after which the remainder passes back to the donor.
Charitable Donor-Advised Fund: A charitable donor-advised fund account can be a valuable wealth planning tool. This structure enables clients to give more strategically through an independent 501(c)(3) custodian sponsored charity with the mission to increase charitable giving in the United States by providing tax-smart and simple giving solutions to donors. There are various options to consider in an effort to provide donor funds to the charities of your choice.