Giving
charitable remainder trust
A charitable remainder trust is an irrevocable trust. You give assets to it, receive income for life or a set term, and the charity receives what is left at the end.
A charitable remainder trust (CRT) is a trust that pays you, or another person you name, income for a period. Then the remainder goes to charity. The IRS says these are irrevocable trusts that let you donate assets to charity and draw annual income for life or for a specific time period. Assets that go in cannot be taken back.
The trust must pay income to at least one living beneficiary. The payment term can run up to 20 years or for one or more lifetimes. The remainder that goes to charity must be at least 10% of the initial net fair market value of the property placed in the trust.
For example: a couple puts $500,000 of appreciated stock into a CRT. The trust pays them an income each year for life. At the end, what remains goes to the ministries they chose. They may receive a partial charitable deduction, and the payments they get are taxable under IRS ordering rules.
Why it matters: a CRT can fit a family that wants income now and a gift later. It is complex, it costs money to set up and run, and an attorney must draft it. Ask your own attorney and CPA before acting.
Learn more on our charitable giving strategy page.
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