Charitable Remainder Unitrust
CSB may be named as the beneficiary of a 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!
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.
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
Give It Twice Trust
You may be looking for a way to provide your children with income while making a gift to Community Shelter Board. The "give it twice" trust is a popular option that allows you to transfer your IRA or other asset at death to fund a term of years charitable remainder unitrust. We call this kind of unitrust a give it twice trust because you can use the trust to pay income first to your family for a number of years and then distribute the balance of the trust to charity.
How a give it twice trust works
- We can help you and your attorney with the process of creating a charitable remainder unitrust.
- You complete an IRA or other retirement account beneficiary designation form, naming the charitable trust as the beneficiary, and return the form to the account custodian.
- When you pass away, the custodian will transfer your retirement account to the charitable trust.
- The trust will pay income to your spouse, children or other individual beneficiaries for their life, term of years or life plus term of years.
- At the conclusion of the payments, the balance of the trust will be transferred to Community Shelter Board.
Benefits of a give it twice trust
- Use the full value of your unused retirement account to provide income to your surviving spouse and to provide income to children or other loved ones for a specified period of time
- Create an estate tax deduction and savings from the charitable gift
- Support the important charitable work of Community Shelter Board
Additional Information
Provides Tax Savings. The gift it twice trust produces income and estate tax savings.
Promotes Fairness. The give it twice trust establishes a mechanism that will help you treat each of your children equally. This can help promote peace in your family.
Teaches Your Children. Give children income rather than a lump sum. Studies of inherited wealth have concluded that many children spend lump sum inheritances, whereas they learn to be more responsible with inheritances paid out over time.
Sale & Unitrust
Are your appreciated assets, such as stock, bonds or real estate, producing little or no income?
If you sell your appreciated assets, you will pay a large capital gains tax. A sale and charitable remainder unitrust may be the solution to avoid capital gains tax.
How a sale and unitrust works
- You establish a charitable remainder unitrust and transfer a portion of your assets to the trust.
- The assets are then sold. You receive cash from the sale, and the rest of the sale's proceeds are paid to the charitable unitrust.
- The trust will provide you with income for the rest of your life.
- You receive a charitable deduction this year to offset your tax on the cash proceeds that you receive from the sale.
Benefits of a sale and unitrust
- Receive cash from the sale. You can use this cash to purchase another residence, to save for retirement, to travel, to meet your daily needs or to meet some other financial goal
- Receive income from the unitrust for the rest of your life and future retirement
- Obtain an income tax deduction that may reduce your tax bill this year
- Further the work of Community Shelter Board with your gift
More on sale and unitrust
When transferring a portion of your primary residence to fund a unitrust, you may apply your one-time home exclusion to reduce or eliminate capital gains tax that would otherwise be due from the sale. Your tax advisor can assist you to determine if you should utilize this strategy.
Contact us
If you are interested in making a gift in this way, please contact us.
Additional Information
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.