Another method to make a gift
and continue to receive income is a Charitable Remainder Trust.
You give assets (usually $100,000 or more) to a trust and
specify that either a fixed amount (Charitable Remainder Annuity
Trust) or a fixed percentage of the trust's value each year
(Charitable Remainder Unitrust) will be paid either for lifetime
to a beneficiary (usually you and/or your spouse or children)
or for a specified period of years not to exceed 20 years.
At the same time, you specify that the remaining principal
at the end of the trust term will go to charity. By naming
SCCF to receive the remaining principal, you can create a
fund in your name that will become your permanent legacy to
the community. You can use the remaining balance to establish
any of the types of funds described at the beginning of this
booklet. The Charitable Remainder Trust is
an ideal vehicle for someone
who:
Has accumulated appreciated assets with
a low yield.
Wants to increase current income without
incurring
capital gains taxes
Wants to reduce estate taxes.
Wants to make significant future charitable
gifts.
Mr and Mrs. Sullivan
Mr and Mrs. Sullivan, who have no children, own some vacant
land for which they must pay property taxes each year. They
purchased this land for $20,000 but it is now worth $100,000.
They decide to give this land to a Charitable Remainder Trust,
for which they receive an immediate income tax deduction, and
specify a 6% income payment as long as they are living. Upon
their deaths, the remaining balance is used to create the Sullivan
Fund at SCCF.
© 2004