A Grantor Charitable Lead Annuity Trust (CLAT) is an irrevocable split-interest trust that provides for a specified amount to be paid to one or more charitable beneficiaries during the term of the trust. The principal remaining in the trust at the end of the term is paid over to, or held in a continuing trust for, a non-charitable beneficiary or beneficiaries identified in the trust. If the terms of a CLAT created during the donor's life satisfy the applicable statutory and regulatory requirements, a gift of the charitable lead annuity interest will qualify for the gift tax charitable deduction under § 2522(c)(2)(B) and/or the estate tax charitable deduction under § 2055(e)(2)(B). In certain cases, the gift of the annuity interest may also qualify for the income tax charitable deduction under § 170(a). The value of the remainder interest is a taxable gift by the donor at the time of the donor's contribution to the trust.
This form is a generic example that may be referred to when preparing such a form for your particular state. It is for illustrative purposes only. Local laws should be consulted to determine any specific requirements for such a form in a particular jurisdiction.
The Arizona Inter Vivos Granter Charitable Lead Annuity Trust (AZ IVG FLAT) is a legal instrument or trust established by an individual, known as the granter, in the state of Arizona. It offers individuals a unique opportunity to support charitable causes while providing potential tax benefits. This trust operates under specific guidelines and regulations, ensuring that the donated funds are utilized for charitable purposes. The AZ IVG FLAT operates by transferring assets or funds into the trust while designating a charitable organization or organizations as the beneficiary. The granter determines the duration of the trust and specifies the annual payment to be made to the charitable organization(s). This fixed annuity payment remains constant throughout the trust's existence and is based on a predetermined percentage of the trust's initial value. One type of AZ IVG FLAT is the Charitable Lead Annuity Trust (FLAT) which operates on a fixed annuity basis. The granter establishes the trust, designates the charitable beneficiaries, determines the annuity amount, and specifies the trust's duration. Another type is the Charitable Lead Unit rust (CLUB), which operates on a variable annuity basis. The granter establishes this trust and designates charitable beneficiaries, but the annuity payment fluctuates based on the trust's annual value. The Arizona Inter Vivos Granter Charitable Lead Annuity Trust provides various advantages to the granter, including potential tax benefits. By transferring assets to the trust, the granter can potentially reduce income, gift, or estate taxes. Furthermore, since the charitable organization(s) receive annual payments, the granter can see the positive impact of their contribution throughout the lifetime of the trust. It is essential to consult with legal and financial professionals when establishing an AZ IVG FLAT to ensure compliance with Arizona laws. These professionals can assist in drafting the necessary legal documents and provide guidance on selecting suitable charitable beneficiaries. By creating an Arizona Inter Vivos Granter Charitable Lead Annuity Trust, individuals can leave a lasting philanthropic legacy while potentially benefiting from tax advantages.The Arizona Inter Vivos Granter Charitable Lead Annuity Trust (AZ IVG FLAT) is a legal instrument or trust established by an individual, known as the granter, in the state of Arizona. It offers individuals a unique opportunity to support charitable causes while providing potential tax benefits. This trust operates under specific guidelines and regulations, ensuring that the donated funds are utilized for charitable purposes. The AZ IVG FLAT operates by transferring assets or funds into the trust while designating a charitable organization or organizations as the beneficiary. The granter determines the duration of the trust and specifies the annual payment to be made to the charitable organization(s). This fixed annuity payment remains constant throughout the trust's existence and is based on a predetermined percentage of the trust's initial value. One type of AZ IVG FLAT is the Charitable Lead Annuity Trust (FLAT) which operates on a fixed annuity basis. The granter establishes the trust, designates the charitable beneficiaries, determines the annuity amount, and specifies the trust's duration. Another type is the Charitable Lead Unit rust (CLUB), which operates on a variable annuity basis. The granter establishes this trust and designates charitable beneficiaries, but the annuity payment fluctuates based on the trust's annual value. The Arizona Inter Vivos Granter Charitable Lead Annuity Trust provides various advantages to the granter, including potential tax benefits. By transferring assets to the trust, the granter can potentially reduce income, gift, or estate taxes. Furthermore, since the charitable organization(s) receive annual payments, the granter can see the positive impact of their contribution throughout the lifetime of the trust. It is essential to consult with legal and financial professionals when establishing an AZ IVG FLAT to ensure compliance with Arizona laws. These professionals can assist in drafting the necessary legal documents and provide guidance on selecting suitable charitable beneficiaries. By creating an Arizona Inter Vivos Granter Charitable Lead Annuity Trust, individuals can leave a lasting philanthropic legacy while potentially benefiting from tax advantages.
