Charitable Remainder Trust
What is a Charitable Remainder Trust?
Life income gifts, such as a Charitable Remainder Trust (CRT), may be the answer to assuring the future of both your loved ones and the IEEE Foundation.
Charitable remainder trusts are tax-free trusts that pay you – as well as other possible designated beneficiaries – an annual distribution, often in quarterly installments.
Charitable Remainder Trusts enable you to support one or more charities that have a special meaning for you, while retaining the security of income for you and/or your loved ones.
CRTs are irrevocable and tax-exempt, therefore they can offer attractive tax benefits. You, as the donor will:
- Receive regular income payment for life (or term of years)
- Get an income tax deduction for a substantial portion of the value of the gift you make to establish the CRT
- Avoid capital gains tax on the appreciated assets you use to establish the trust
- Know that your gift will help shape the future of the engineering profession
There are two types of Charitable Remainder Trusts.
Charitable Remainder Unitrust (CRUT) which pays out an amount, at least 5% and not more than 50%, of the annual value of trust assets to the income beneficiary. CRUTs are the more flexible of the two types and allow for additional contributions. CRUTs generally produce higher amounts of income but a smaller tax deduction. CRUTs are good for someone looking to grow their income stream as the trust value grows over the years.
Charitable Remainder Annuity Trust (CRAT) which pays a fixed dollar amount, at least 5% and not more than 50%, of the initial fair market value of trust assets to the income beneficiaries. No additions to the principal may be made once a CRAT is established. CRATs are good for someone who wants to guarantee a fixed income stream each and every year, regardless of the performance of the trust.
Remembering the IEEE Foundation in your Charitable Remainder Trust
CRTs provide for and maintain two sets of beneficiaries.
- First is the income beneficiaries who receive income from the trust for life, or a term of years. This can be anyone - you, your spouse, a child, a sibling - anyone.
- Second are the charitable beneficiaries you name, like the IEEE Foundation. The named charities will receive the remaining principal in your CRT in accordance with your instructions.
You can name the IEEE Foundation as one of or your sole charitable beneficiary. Like a bequest, you can specify a specific IEEE donor supported program or initiative for your gift to ultimately support. To establish or modify a Charitable Remainder Trust, consult your legal advisors.
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If you decide to name the IEEE Foundation as a beneficiary of your CRT, please share the good news with us! A member of the IEEE Foundation team will work with you to ensure your wishes can be fulfilled and acknowledge your generosity by recognizing you as a member of the IEEE Goldsmith Legacy League, an elite group of legacy giving donors. You may request to remain anonymous.
The information on this site is for educational purposes only and is not intended as legal, tax, or investment advice. If you are considering a planned gift to the IEEE Foundation, we highly recommend you consult with your own tax and legal advisors to determine the best options for you.