Charitable remainder trust

(redirected from Split-Interest Trust)
Also found in: Legal.

Charitable remainder trust

An irrevocable trust that pays income to a designated person or persons until the grantor's death, when the income is passed on to a designated charity. A charitable lead trust by contrast allows the charity to receive income during the grantor's life, and the remaining income to pass to designated family members upon the grantor's death.

Charitable Remainder Trust

An irrevocable trust in which the grantor deposits assets with the income from the investment of these assets given to beneficiaries for a certain period of time. After the time expires, the remainder of the assets and income are donated to charity. A charitable remainder trust allows the grantor to provide for his/her survivors after death while reducing to a minimum the estate tax because the assets are ultimately directed to charity.

charitable remainder trust

A trust that pays an income to one or more individuals for a specified length of time then leaves the remainder of the trust to a designated charity. A charitable remainder trust can produce substantial tax benefits and is particularly suitable for use by a married couple with no children. Compare charitable lead trust.

Charitable remainder trust.

A charitable remainder trust (CRT) is an irrevocable trust designed to provide income to you or a beneficiary for either a fixed period or until the recipient dies. At that point, all remaining assets go to the charity named as ultimate beneficiary.

At the time you establish the trust, you can deduct the discounted present value of the assets as a charitable contribution. That value The value, which is calculated using IRS tables, may be less than the market value of these assets.

Transferring assets in a CRT not only reduces the value of your estate for estate tax purposes but also eliminates potential capital gains tax on any increased value of the assets.

References in periodicals archive ?
2055(e)(2) is strictly followed for a split-interest trust in which charitable and noncharitable beneficiaries have an interest in the same property.
508(e) apply to a split-interest trust, except that the excess business holdings and the jeopardy investment rules do not apply if, generally, the charitable portion for which a deduction was allowed is not worth more than 60% of the trust's value.
The Split-Interest Trust Information return is filed by trusts with both charitable and noncharitable beneficiaries.
A split-interest trust (SIT) can be created by a will or a trust instrument.
7520 dictates the rate of return that assets in a split-interest trust will be assumed to earn over the trust term.
Given this clear statutory linkage of the three terms, there is simply no statutory basis for the regulation, which by its terms pulls assets of a split-interest trust, which makes a distribution to a private foundation, into the "assets" of the foundation.
A third type of gift mechanism is the split-interest trust, which has dual recipients: a private beneficiary and a charity.
The Split-Interest Trust Information Return (Form 5227) is filed by entities with both charitable and noncharitable beneficiaries.
Income Tax Return for Estates and Trusts; 3 1/2 months on Form 5500, Annual Return/Report of Employee Benefit Plan; and six months on Form 990, Return of Organization Exempt From Income Tax; Form 4720, Return of Certain Excise Taxes Under Chapters 41 and 42 of the Internal Revenue Code; Form 5227, Split-Interest Trust Information Return; Form 6069, Return of Excise Tax on Excess Contributions to Black Lung Benefit Trust Under Section 4953 and Computation of Section 192 Deduction; Form 8870, Information Return for Transfers Associated With Certain Personal Benefit Contracts; and Form 3520-A, Annual Information Return of a Foreign Trust With a U.
As the name implies, a split-interest trust (SIT) can have both charitable and noncharitable beneficiaries.
Charitable lead annuity trusts (CLATs): An inter vivos CLAT is a split-interest trust created by a donor during the donor's life that pays an annuity to a charity for a term of years or for the life of the donor or another individual.
43% Public, societal benefit 27% Education 7% Health 6% Human services 5% Religion-related 4% Environment, animals 4% Arts, culture, and humanities 4% Other Source: "Snapshot of Split-Interest Trust Data" IRS Statistics of Income, tinyurl.