Charitable Remainder Trust
A Charitable Remainder Trust (CRT) is a planned gift that offers tax advantages and an income stream.
How a trust works
- The donor transfers cash, securities or other appreciated property into a trust.
- The trust pays a percentage (at least 5 percent) of the value of its principal to the donor or the beneficiaries of the donor's choice.
- When the trust terminates, the remainder passes to Bucknell University.
- Gift minimum: $100,000
Benefits of a trust
- This arrangement provides an immediate income tax deduction for a portion of the donor's contribution to the trust.
- The donor pays no upfront capital gains tax on appreciated assets that he or she donates.
- The donor or designated beneficiaries receive income for life or a term of years.
Types of trusts
A Charitable Remainder Annuity Trust (CRAT) pays a fixed amount of the initial value of the trust each year.
A Charitable Remainder Unitrust (CRUT) pays a percentage of the value of its principal, which is re-valued annually, to the donor or to named beneficiaries. Donors can make additional gifts to the trust as circumstances allow and qualify for additional tax deductions. CRUTs can be funded with many different assets, including real estate.
- A term-of-years trust can be established to assist with college education costs.
- Trusts can be funded to provide income for parents or someone else you care about.
- Trusts can be established to support multiple charities.