Charitable Remainder Trust

July 12, 2019

Charitable Remainder Trust: Giving While Managing Your Retirement


You want to make a significant gift to charity.  You need an income stream now or in the future.  You have appreciated assets such as real estate or stock.    You want to give in a tax-efficient way. IF this describes you, you may want to consider a Charitable Remainder Trust.

A charitable remainder trust is used to convert assets into income and charitable gifts.  The assets should be marketable and no longer needed by you.  Here’s an example:

John & Mary bought a piece of investment land 30 years ago.  Today that land is worth 5 times what they paid for it.  They would like to seel it and use the proceeds to provide a retirement income stream.  But selling it would cause a huge capital gains tax problem that discourages them from considering selling the property.  A Charitable Remainder Trust can help.

Here is how it works:  With the help of your advisor, one or more assets are transferred to the trust and sold… tax-free! The proceeds of the sale are invested inside the trust.  You or your beneficiaries receive payments from the trust for your life or a certain period of years.  What remains when the trust ends is given to the charity potentially creating substantial tax benefits.  


The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor. This is a hypothetical example and is not representative of any specific situation. Your results will vary. The hypothetical rates of return used do not reflect the deduction of fees and charges inherent to investing.