Charitable Remainder Unitrust:
Smart Retirement Strategy

© Connie Gelb   Contact Us  Need more information about planned giving with The Retirement Resource Organization?  E-mail:  legacy@retirement-resource.org Toll-free: (877) 855-3718

You can use a charitable remainder unitrust to build your retirement assets. There is a special variation on the unitrust (called a “flip” unitrust) that allows you to give appreciated assets to a trust that makes little or no income payments until a “triggering event” occurs. You may chose your triggering event to be a date in the future when you expect to retire, perhaps your 65th birthday.

Until your "triggering event", the trust assets could be invested for growth.  Your trust will "flip" at the beginning of the tax year, immediately following the triggering event and begin to pay a fixed percentage of the trust value.

Benefits

• Eliminate your capital gains tax liability (if you donate appreciated assets)
• Receive an income tax charitable deduction
• Receive a greater lifetime stream of income than from a regular unitrust

How It Works (example)
Frank, age 60, owns securities that cost him $60,000 originally and are now worth $100,000. He donates the securities to us and establishes a charitable remainder “flip” unitrust, naming his 55 year-old wife Martha, as lifetime beneficiary. Frank chooses an annual payment of 5% of the value of the trust, payable after Martha turns 65. George receives an income tax charitable deduction of approximately $34,000. He also avoids the capital gain tax he would have paid had he sold the securities.

Based on an assumed growth of 10% a year in the market value of the trust, Martha’s first annual payment is estimated at about $10,200. The trust will be revalued each year and Martha’s payment will change and may grow over time. After her lifetime, the Organization will use the trust assets to help caregivers and retirees as Frank designated.

Charitable Remainder Unitrust

Information provided on our Internet site is not intended to be tax or legal advice. Rates used in examples are for illustrative purposes only.  Please consult a qualified legal or financial advisor before making a gift.