How do you help a donor set up a charitable remainder unitrust? More to the point, how do you accept a CRUT on behalf of your organization? It's a process that's bound to take several weeks to complete, but in truth it's not as complicated as it could be. Read on to find out more.
Now for the fun stuff: TAXES
Do you know how to help a donor convert a valuable asset into a charitable remainder unitrust (CRUT) through your organization? Check out the GPFG to learn more about the types of assets that can be used to fund a CRUT.
WHO: A benefactor is likely in the 50-to-75 age range who wants to make a gift to your organization and has a highly appreciated asset.
The tax benefits of a CRT happen on both ends: The benefactor gets tax benefits in the form of a charitable deduction when the trust is set up, and the asset is likely removed from the estate.
Typically, the assets that fund a CRAT are highly appreciated assets that have been held long-term and are easily convertible to an income-producing asset.
WHO: Typically, a benefactor who takes advantage of a CRAT is between 50 and 70 years of age.
A CRAT must pay a fixed rate of return at least annually, and the minimum amount it must distribute is 5% of the original funding value.
CLTs are almost always initiated through the work of the benefactor's financial advisors and not through the development officer. Why?