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.
The Suffolk New York Charitable Lead Inter Vivos Unit rust is a financial planning tool used by individuals or organizations to support charitable causes while simultaneously benefiting from tax advantages. This type of trust is specifically designed for residents of Suffolk County, New York and offers several variations to cater to different needs and objectives. Charitable Lead Inter Vivos Unit rust (CLT): A Charitable Lead Inter Vivos Unit rust, commonly known as a CLT, is a specific type of trust that allows donors to transfer assets to a trust during their lifetime. The trust then pays a fixed or variable income to a chosen charitable organization for a set term. Once the term ends, the remaining assets held in the trust are distributed to the donor's beneficiaries, such as family members or other non-charitable individuals. Suffolk New York CLT: The Suffolk New York CLT is specifically tailored to residents of Suffolk County. It follows the same principles as a traditional CLT, but is governed by local laws and regulations applicable to charitable trusts in Suffolk County. This trust provides individuals living in Suffolk with the opportunity to support charitable causes within their own community while receiving potential tax benefits. Benefits of Suffolk New York Charitable Lead Inter Vivos Unit rust: 1. Tax Advantages: By establishing a Suffolk New York Charitable Lead Inter Vivos Unit rust, individuals can potentially reduce their estate or gift taxes. The income distributed to charitable organizations is typically tax-deductible, lowering overall tax burdens during the donor's lifetime. 2. Philanthropic Impact: This trust allows individuals to support causes they care deeply about in Suffolk County, contributing to the betterment of the local community. Whether it's funding education, healthcare, environmental initiatives, or any other charitable purpose, the trust provides a meaningful avenue for philanthropy. 3. Legacy Building: Donors can establish a lasting legacy by naming charitable beneficiaries of their choice. This allows them to make a significant impact even after their lifetime, influencing positive change within Suffolk County for years to come. 4. Wealth Management: The Suffolk New York Charitable Lead Inter Vivos Unit rust provides an opportunity for individuals to maintain control over their assets and investments during the trust term. This allows donors to potentially grow the trust's assets while providing income to charitable organizations. 5. Flexibility in Trust Structures: Donors have the flexibility to choose between a fixed or variable income distribution from the trust to charitable beneficiaries. Depending on their financial goals and personal circumstances, individuals can customize the trust structure that best aligns with their preferences. Overall, the Suffolk New York Charitable Lead Inter Vivos Unit rust offers a powerful mechanism for philanthropy, tax planning, and wealth management for residents of Suffolk County. By establishing this trust, individuals have the ability to leave a lasting impact on their community while simultaneously enjoying potential financial advantages.The Suffolk New York Charitable Lead Inter Vivos Unit rust is a financial planning tool used by individuals or organizations to support charitable causes while simultaneously benefiting from tax advantages. This type of trust is specifically designed for residents of Suffolk County, New York and offers several variations to cater to different needs and objectives. Charitable Lead Inter Vivos Unit rust (CLT): A Charitable Lead Inter Vivos Unit rust, commonly known as a CLT, is a specific type of trust that allows donors to transfer assets to a trust during their lifetime. The trust then pays a fixed or variable income to a chosen charitable organization for a set term. Once the term ends, the remaining assets held in the trust are distributed to the donor's beneficiaries, such as family members or other non-charitable individuals. Suffolk New York CLT: The Suffolk New York CLT is specifically tailored to residents of Suffolk County. It follows the same principles as a traditional CLT, but is governed by local laws and regulations applicable to charitable trusts in Suffolk County. This trust provides individuals living in Suffolk with the opportunity to support charitable causes within their own community while receiving potential tax benefits. Benefits of Suffolk New York Charitable Lead Inter Vivos Unit rust: 1. Tax Advantages: By establishing a Suffolk New York Charitable Lead Inter Vivos Unit rust, individuals can potentially reduce their estate or gift taxes. The income distributed to charitable organizations is typically tax-deductible, lowering overall tax burdens during the donor's lifetime. 2. Philanthropic Impact: This trust allows individuals to support causes they care deeply about in Suffolk County, contributing to the betterment of the local community. Whether it's funding education, healthcare, environmental initiatives, or any other charitable purpose, the trust provides a meaningful avenue for philanthropy. 3. Legacy Building: Donors can establish a lasting legacy by naming charitable beneficiaries of their choice. This allows them to make a significant impact even after their lifetime, influencing positive change within Suffolk County for years to come. 4. Wealth Management: The Suffolk New York Charitable Lead Inter Vivos Unit rust provides an opportunity for individuals to maintain control over their assets and investments during the trust term. This allows donors to potentially grow the trust's assets while providing income to charitable organizations. 5. Flexibility in Trust Structures: Donors have the flexibility to choose between a fixed or variable income distribution from the trust to charitable beneficiaries. Depending on their financial goals and personal circumstances, individuals can customize the trust structure that best aligns with their preferences. Overall, the Suffolk New York Charitable Lead Inter Vivos Unit rust offers a powerful mechanism for philanthropy, tax planning, and wealth management for residents of Suffolk County. By establishing this trust, individuals have the ability to leave a lasting impact on their community while simultaneously enjoying potential financial advantages.
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.
