In a charitable lead trust, a donor transfers property to the lead trust, which pays a percentage of the value of the trust assets, usually for a term of years, to the charity. At the end of the trust term, the remaining assets in the trust and any growth it has realized are passed to donor's heirs. Although there is no income tax deduction when the donor creates a charitable lead trust, his/her gift or estate tax is greatly discounted and any growth is passed to his/her heirs gift and estate tax free.
In a charitable lead unitrust, a donor irrevocably transfers cash, closely held securities or other valuable property to a trustee who, during the unitrusts term, invests the unitrust's assets. Each year, the trustee distributes a fixed percentage of the unitrust's net asset value, as calculated annually, to a named charity. These payments are made out of trust income (or trust principal if the trust income is not adequate) and are tax deductible as a charitable contribution for the year in which they are made. If, however, trust income exceeds the charitable payment for a given year, the trust pays income tax on the excess.
When the lead unitrust term ends, the unitrust distributes the remainder of its accumulated assets to a non-charitable remainderman, usually family members or other beneficiaries named by the donor. That amount is subject to federal gift tax based on the current fair market value of the gift at the time the trust is established. Gift tax is paid on the remainder interest as calculated from the current fair market value of the asset at the time the trust is established; generally this amount is much less than the estate tax would be on the asset as calculated at the time it is inherited.
A Franklin Ohio Charitable Lead Inter Vivos Unit rust is a type of estate planning tool that allows individuals to donate a portion of their assets to charitable organizations while retaining some control over the income generated by those assets. It is a popular strategy for individuals who wish to support charitable causes during their lifetime. The Charitable Lead Inter Vivos Unit rust (CLT) is a specific type of trust that combines the benefits of both a charitable lead annuity trust and a charitable remainder trust. This means that it not only provides immediate benefits to charitable organizations, but also allows the granter or other designated beneficiaries to receive income from the trust for a certain period of time. In Franklin, Ohio, there may be various types of Charitable Lead Inter Vivos Unit rusts available, including the following: 1. Standard Charitable Lead Inter Vivos Unit rust: This is the most common type, where the granter designates specific charitable organizations to receive annual payments from the trust for a predetermined period. 2. Diversionary Charitable Lead Inter Vivos Unit rust: Here, any remaining assets in the trust at the end of the specified period revert to the granter or other named non-charitable beneficiaries. 3. Non-Grantor Charitable Lead Inter Vivos Unit rust: In this variation, the granter does not receive any income from the trust during their lifetime. Instead, the trust is created for the benefit of other designated beneficiaries. 4. Net Income Charitable Lead Inter Vivos Unit rust: This type allows for annual payments to be made to the charitable organizations based only on the trust's net income, rather than a fixed percentage or amount. 5. Flip Charitable Lead Inter Vivos Unit rust: This variation allows for the trust to transition from a charitable lead trust to a charitable remainder trust at a certain triggering event, such as the death of the granter or a change in circumstances. It's important to consult with an experienced estate planning attorney in Franklin, Ohio, to determine the most suitable type of Charitable Lead Inter Vivos Unit rust based on individual goals and circumstances. These trusts offer a unique opportunity to support charitable causes while potentially receiving tax benefits and maintaining financial security for loved ones.A Franklin Ohio Charitable Lead Inter Vivos Unit rust is a type of estate planning tool that allows individuals to donate a portion of their assets to charitable organizations while retaining some control over the income generated by those assets. It is a popular strategy for individuals who wish to support charitable causes during their lifetime. The Charitable Lead Inter Vivos Unit rust (CLT) is a specific type of trust that combines the benefits of both a charitable lead annuity trust and a charitable remainder trust. This means that it not only provides immediate benefits to charitable organizations, but also allows the granter or other designated beneficiaries to receive income from the trust for a certain period of time. In Franklin, Ohio, there may be various types of Charitable Lead Inter Vivos Unit rusts available, including the following: 1. Standard Charitable Lead Inter Vivos Unit rust: This is the most common type, where the granter designates specific charitable organizations to receive annual payments from the trust for a predetermined period. 2. Diversionary Charitable Lead Inter Vivos Unit rust: Here, any remaining assets in the trust at the end of the specified period revert to the granter or other named non-charitable beneficiaries. 3. Non-Grantor Charitable Lead Inter Vivos Unit rust: In this variation, the granter does not receive any income from the trust during their lifetime. Instead, the trust is created for the benefit of other designated beneficiaries. 4. Net Income Charitable Lead Inter Vivos Unit rust: This type allows for annual payments to be made to the charitable organizations based only on the trust's net income, rather than a fixed percentage or amount. 5. Flip Charitable Lead Inter Vivos Unit rust: This variation allows for the trust to transition from a charitable lead trust to a charitable remainder trust at a certain triggering event, such as the death of the granter or a change in circumstances. It's important to consult with an experienced estate planning attorney in Franklin, Ohio, to determine the most suitable type of Charitable Lead Inter Vivos Unit rust based on individual goals and circumstances. These trusts offer a unique opportunity to support charitable causes while potentially receiving tax benefits and maintaining financial security for loved ones.
Para su conveniencia, debajo del texto en español le brindamos la versión completa de este formulario en inglés. For your convenience, the complete English version of this form is attached below the Spanish version.
