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Charitable Remainder Annuity Trust

You may be looking for a way to receive fixed income for life or a number of years. You may be concerned about the high cost of capital gains tax with the sale of an appreciated asset. Perhaps you recently sold property and are looking for a way to save on taxes and plan for retirement. A charitable remainder annuity trust may offer the solutions you need.

Benefits of a charitable remainder annuity trust

• Receive fixed income for life or a term of up to 20 years
• Avoid capital gains tax on the sale of your appreciated assets
• Receive an immediate charitable income tax deduction for the charitable remainder portion of your gift to Susquehanna University

How a charitable remainder annuity trust works

1. You transfer cash or assets to fund a charitable remainder annuity trust.
2. In the case of a trust funded with appreciated assets, the trust will then sell the assets tax-free.
3. The trust is invested to pay fixed income to you or any other trust beneficiaries you select based on a life, lives or a term of up to 20 years.
4. You receive an income tax deduction in the year you transfer assets to the trust.
5. Susquehanna University benefits from what remains in the trust after all the trust payments have been made.

More on charitable remainder annuity trusts

If you are tired of the fluctuating stock market and want to receive fixed payments, a charitable remainder annuity trust may provide you with the stability you desire. A charitable remainder annuity trust pays a fixed amount each year based on the value of the property at the time the trust is funded.

Sample Charitable Remainder Annuity Trust Scenario

Miranda lived in the family home where she and her spouse had raised their three children. After her spouse passed away, Miranda found it increasingly difficult to care for her property.

Miranda's grandson came often to visit and help with chores around the house. On one such visit, he helped Miranda "surf" the internet. She enjoyed reading the weekly finance updates and donor stories on her favorite charity's planned giving website. On one such visit, Miranda learned that she could make a gift of her home to the charity and receive income for life.

Miranda thought that she might want to move to a condominium with less upkeep. Her financial advisor reviewed the plan and said that the income she received from the charitable remainder trust would be enough to cover her living expenses.

Miranda was thrilled that she could turn her property into income to meet her future needs and receive a charitable deduction for her gift.

Is a gift of your home to fund a charitable trust right for you?

Your home has been one of your best assets, but after the kids move out and the house gets harder to care for, you may have other needs. Better than a reverse mortgage, a unitrust is one strategy to "downsize" your home, avoid capital gains tax and provide you with income.

If you have questions about how a unitrust could help you downsize, please give us a call. We would be happy to answer questions that you might have.

*Please note: The name and image above are representative of a typical donor and may or may not be an actual donor to our organization. Since your unitrust benefits may be different, you may want to click here to view a color example of your benefits.

Contact us

If you have any questions about charitable remainder annuity trusts, please contact us. We would be happy to assist you and answer any questions you might have.