A Charitable Remainder Trust is a gift that gives back. This flexible estate and financial planning tool allows you to give property of substantial value or other assets to the Jewish Community Foundation-and, in return, receive benefits including income for life and reduced estate, capital gains and income taxes. Learn more in our Charitable Trusts Brochure.

It also allows you to build a permanent legacy in your name, supporting a field of interest or specific programs or organizations that are important to you.

Advantages of a Charitable Remainder Trust

• A Remainder Trust pays lifetime income to your designated beneficiaries (for example, yourself and your spouse).

• You qualify for an charitable deduction when the Remainder Trust is established.

• If you can't use the entire charitable deduction in the current year, you can carry it forward up to five years.

• Your gift may also reduce your capital gains and estate taxes.

• Your Remainder Trust is a tax-exempt entity.

• When the Remainder Trust terminates (usually at death), the remaining assets pass to The Foundation to establish a permanent legacy in your name.

• The Foundation will handle all administrative responsibilities associated with your Charitable Remainder Trust, including the investment of assets.

How to Establish a Charitable Remainder Trust

• To establish your Remainder Trust, you will need to transfer assets to a trust, naming The Foundation or another fiduciary as trustee.

• It is common to use appreciated marketable securities, closely held stock and real estate as your assets, depending on the type of Remainder Trust.

• You can specify lifetime income beneficiaries (for example, you and your spouse) and designate The Foundation to receive assets that remain in the trust after those beneficiaries have passed away.

• You can create a Charitable Remainder Trust during your life, or at death through your will or revocable trust.

Two Types of Charitable Remainder Trusts

Each type of trust offers distinct advantages. The Foundation can provide your attorney with model trust documents that they can tailor to meet your specific situation.

Charitable Remainder Annuity Trust (CRAT)

• This trust pays income beneficiaries a fixed annual amount equal to at least 5% of the initial fair market value of your gift, regardless of the trust's earnings.

• Payments from a CRAT do not vary and this predictability appeals to donors who don't want their income stream tied to market performance.

• No additional contributions to a CRAT are permitted after it is created.

Charitable Remainder Unitrust (CRUT)

• This trust pays income beneficiaries a variable annual amount equal to a fixed percentage (at least 5%) of the net fair market value of the trust assets. You can specify the percentage when you create the trust.

• Trust assets are re-valued annually and your income is adjusted accordingly. If the value goes up, so does the annual payment. If the value declines, the annual payment does, too.

• You may contribute additional assets to a CRUT after it is created.

A Charitable Lead Trust makes annual gift payments from its assets to The Foundation, allowing you to build a permanent legacy in your name.

Through your Charitable Lead Trust you can choose to support The Foundation's annual grants program, a specific field of interest or specific programs or organizations you care about.

At the end of a set term of years, the remaining assets in your Lead Trust pass back to you, the donor, or to designated beneficiaries such as children or grandchildren.

How a Charitable Lead Trust Works

• To establish your Lead Trust, you will need to transfer assets to a trust, naming The Foundation or another fiduciary as trustee.

• Once established, your Lead Trust makes annual income gift payments to The Foundation, establishing a permanent legacy in your name and allowing you to see the immediate results of your gift.

• You determine whether your Lead Trust annually pays out a fixed amount (Charitable Lead Annuity Trust) or a percentage of its assets (Charitable Lead Unitrust).

• When the Lead Trust terminates (after a set term of years), the remaining assets in the trust pass back to you or your designated beneficiaries allowing you to transfer significant assets to children or grandchildren with reduced generation-skipping, gift and estate taxes.

When to Create Your Charitable Lead Trust

• You may create a Charitable Trust during your life, or at death through your will or revocable trust.

• The Foundation can provide your attorney with model trust documents that they can tailor to meet your specific situation.

• The Foundation will handle all administrative responsibilities associated with your Charitable Lead Trust, including the investment of assets.