Charity That Ends at Home

Many trust plans, such as charitable remainder trusts, are designed to pay income to you or your family before the remainder goes to a charitable organization. But a plan that's often overlooked yet highly useful does just the opposite: a charitable lead trust.

This trust pays out income to a qualifying charitable organization, like your favorite charitable organizations, for a number of years, but when the trust term is up, the principal goes to your heirs with reducedóor even eliminatedógift or estate taxes.

This is an outstanding way to transfer property to family members down the line (e.g., children and grandchildren) at a minimal tax cost, especially if you're well-to-do enough that you can forgo investment income on some assets.

Benefits of a Lead Trust
A lead trust that benefits your favorite charitable organizations at the start and members of your family later is created to save gift and estate taxes; it doesn't get an income tax charitable deduction.

By funding a charitable lead trust now, you may be able to exclude the trust income from your gross income and future appreciation from your estate. You will obtain a gift tax deduction for the present value of the income interest given to us. If you create a lead trust by will, an estate tax charitable deduction will be allowed for the present value of the income interest bequeathed to charitable nonprofits.

A lead trust is particularly gratifying because your benevolence makes it possible for us to fulfill our pressing needs much sooner, in comparison to a charitable remainder trust.

Please contact Mary Ludwig, Development Director at 712-732-5127, for more information.

The information on this site is not intended as legal, tax or investment advice. For such advice, please consult an attorney, tax professional or investment professional.

Copyright © The Stelter Company, All Right Reserved.

Essentials

Ways to Give

What to Give

Reading Room

Glossary of Terms

Q&A

Goals & Gifts

Bequest Language