Charitable remainder trust

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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.
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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.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

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.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.

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.

Dictionary of Financial Terms. Copyright © 2008 Lightbulb Press, Inc. All Rights Reserved.
References in periodicals archive ?
For example, consider an impermissible split-interest trust with a single noncharitable life tenancy interest actuarially valued at $100,000 and a charitable remainder interest actuarially valued at $900,000.
A split-interest trust can be created by executing a will or a separate trust instrument.
528), the decedent's will created a split-interest trust, where the decedent's grandnephew and a charity for children were beneficiaries.
Under the trust terms, A is creating a split-interest trust, consisting of a life estate transferred to her mother and a remainder interest to her child.
A split-interest trust can be created by a will or in a separate trust instrument.
A charitable remainder annuity trust (CRAT) is a form of split-interest trust established between one or more donors and a trustee.
The operation of a split-interest trust typically involves one beneficiary-type (either charitable or non-charitable) receiving payments over a period of time, and then the other beneficiary-type receiving the remaining trust assets.
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.S.
Form 5227, the Split-Interest Trust Information Return, is filed for trusts with both charitable and noncharitable beneficiaries.
* Form 5227 (Split-Interest Trust Information Return);
This split-interest trust is the vehicle that provides an income interest to a charity and a remainder interest (in the future) to non-charitable beneficiaries.
Split-Interest Trust This annual study provides information Information: on charitable remainder trusts, Lisa Rosenmerkel charitable lead trusts, and pooled income funds.