In establishing a Charitable Remainder Trust, a donor irrevocably transfers cash or property to the trust and creates two interests - an income interest for an individual beneficiary named by the donor, and a remainder interest for the Jewish Community Foundation. The income interest can be paid for the life of the beneficiary or for a term of up to 20 years. Upon the death of the income beneficiary, or at the end of the specified term of years, the balance of the trust assets is held by the Foundation in a named endowment fund.
- Trust payouts are generally of two types - either a fixed percentage of the trust assets or a fixed dollar amount.
- The income payments from a Charitable Remainder Unitrust, fluctuate annually with the fair market value of the trust assets. Additions can be made to a unitrust at any time.
- The income payments from a Charitable Remainder Annuity Trust are fixed for the term of the trust. The payment amount is determined at the time the gift is made. No additions may be made to an annuity trust.
- A charitable remainder trust can be established with a transfer of $100,000 or more. Appreciated securities are ideal assets to fund these trusts.
Advantages of a Charitable Remainder Trust:
- You or another will receive income for life or for a specified term of years
- If you fund the trust with low-yielding securities, you may be able to increase your current income
- If you transfer appreciated securities or other assets to the trust, you may avoid capital gains taxes on the transfer
- You will receive an immediate income tax charitable deduction
- You may reduce your estate taxes
- You will have the satisfaction of creating a legacy for the Greater Hartford Jewish community
- You will be invited to join the Foundation's Legacy Society
