Charitable Remainder Trust
Tax-Smart Gifts That Provide Income
If you have built a comfortable estate and also are looking for ways to receive reliable payments, consider a charitable remainder trust. At the end of the trust term, the balance in the trust is used to support UB in the manner you specify.
These types of gifts may offer you tax benefits and the option for income. There are two ways to receive payments and each has its benefits:
- The charitable remainder annuity trust pays you, each year, the same dollar amount you choose at the start. Your payments stay the same, regardless of fluctuations in trust investments.
- The charitable remainder unitrust pays you, each year, a variable amount based on a fixed percentage of the fair market value of the trust assets. The amount of your payments is redetermined annually. If the value of the trust increases, so do your payments. If the value decreases, however, so will your payments.
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An Example of How It Works
Susan, 75, wants to make a gift to the University at Buffalo Foundation but she would also like more income in the future. Susan creates a charitable remainder unitrust with annual lifetime payments to her. These payments are equal to 5% of the fair market value of the trust assets as revalued annually. She funds the trust with assets valued at $500,000.
Susan receives $25,000 the first year from the trust. Subsequent payment amounts vary each year depending on the annual valuations of the trust assets. She is eligible for a federal income tax charitable deduction of $299,845* in the year she creates and funds the trust. This deduction saves Susan $95,950 in her 32% tax bracket.
*Based on a 1.2% charitable midterm federal rate. Deductions and calculations will vary depending on your personal circumstances.
For a free personalized illustration of how you can benefit from a charitable gift, contact Wendy Irving, Esq. at email@example.com or (877) 825-3422.
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- Contact Wendy Irving, Esq. at (877) 825-3422 or firstname.lastname@example.org to talk about supporting the University at Buffalo Foundation by setting up a charitable remainder trust.
- Seek the advice of your financial or legal adviser.
- If you include the University at Buffalo Foundation in your plans, please use our legal name and federal tax ID.
Legal Name: University at Buffalo Foundation, Inc.
Address: 503 Capen Hall, Buffalo, NY 14260
Federal Tax ID Number: 16-0865182