Search
Close this search box.
Home / Articles / Give and receive with a charitable remainder trust

Give and receive with a charitable remainder trust

July 24, 2014

Share:

Would you like to benefit charity while reducing the size of your taxable estate yet maintain an income stream for yourself? Would you also like to divest yourself of highly appreciated assets and diversify your portfolio with minimal tax consequences? Then consider a CRT. Here’s how it works:

• When you fund the CRT, you receive a partial income tax deduction and the property is removed from your estate.
• For a given term, the CRT pays an amount to you annually.
• At the term’s end, the CRT’s remaining assets pass to charity.

If you fund the CRT with appreciated assets, it can sell them without paying tax on the gain and then invest the proceeds in a variety of stocks and bonds. You’ll owe capital gains tax when you receive CRT payments, but much of the liability will be deferred. Plus, only a portion of each payment will be attributable to capital gains. This also may help you reduce or avoid exposure to the 3.8% net investment income tax and the 20% top long-term capital gains rate.
For more ideas on tax-smart gifts to charity, minimizing estate taxes, maintaining an income stream or diversifying your portfolio tax efficiently, contact us.

© 2014

All content provided in this article is for informational purposes only. Matters discussed in this article are subject to change. For up-to-date information on this subject please contact a Clark Schaefer Hackett professional. Clark Schaefer Hackett will not be held responsible for any claim, loss, damage or inconvenience caused as a result of any information within these pages or any information accessed through this site.

Guidance

Related Articles

Article

2 Min Read

Embracing the Future: Strategic HR Has a New Name, New Image, New Office

Article

2 Min Read

Reducing Your Company’s Tax Liability in 2023: 5 Strategic Tips

Article

2 Min Read

IRS Extends Delay of New Reporting Threshold for Cash Apps

Article

2 Min Read

3 Tips to Maintain Integrity through Economic Pressure

Article

2 Min Read

Audit Requirements for Defined Contribution Plans are Changing 

Article

2 Min Read

IRS Releases 2024 Cost-of-Living Adjustment Numbers 

Get in Touch.

What service are you looking for? We'll match you with an experienced advisor, who will help you find an effective and sustainable solution.

  • Hidden
  • This field is for validation purposes and should be left unchanged.