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.
California Inter Vivos Granter Charitable Lead Annuity Trust (FLAT) is a specific type of charitable trust established by a living person (the granter) in the state of California. This trust is designed to provide support to charitable organizations while also offering various tax advantages for the granter. The California Inter Vivos Granter Charitable Lead Annuity Trust involves the granter transferring assets, such as cash, investments, or real estate, into the trust. The trust then makes annual payments, known as annuities, to one or more charitable organizations for a specified period of time. At the end of this period, any remaining assets in the trust are typically distributed to the granter's designated beneficiaries, such as family members. One of the key benefits of establishing a California Inter Vivos Granter FLAT is the potential reduction of estate and gift taxes. By transferring assets into the trust, the value of the assets is removed from the granter's estate, potentially minimizing estate taxes upon their death. Additionally, the granter can also receive an income tax deduction for the value of the charitable annuity payments made during the trust's term. There are several variations of California Inter Vivos Granter Charitable Lead Annuity Trust, each with its own attributes and benefits. Some common types include: 1. Non-Grantor FLAT: In this variant, the trust is not included in the granter's estate for tax purposes, resulting in potential estate tax savings. 2. Flip FLAT: This type of trust allows for a transition of the trust's status from a charitable lead trust to a non-charitable trust, typically benefiting the granter or their family members after a specified period of time. 3. Reverse FLAT: Unlike the traditional FLAT, where the charity receives annual annuity payments, a reverse FLAT structure provides for annuity payments to the granter initially, followed by the charity receiving the remaining assets. 4. Granter Retained Annuity Trust (GREAT): Although not specifically a FLAT, a GREAT is another type of charitable trust that operates similarly. It allows the granter to retain an annuity payout while benefiting a charitable organization in the long run. In conclusion, the California Inter Vivos Granter Charitable Lead Annuity Trust is a specialized charitable trust that serves to support charitable organizations while providing tax advantages for the granter. Understanding the different variations and their implications can help individuals make informed decisions when establishing such a trust.California Inter Vivos Granter Charitable Lead Annuity Trust (FLAT) is a specific type of charitable trust established by a living person (the granter) in the state of California. This trust is designed to provide support to charitable organizations while also offering various tax advantages for the granter. The California Inter Vivos Granter Charitable Lead Annuity Trust involves the granter transferring assets, such as cash, investments, or real estate, into the trust. The trust then makes annual payments, known as annuities, to one or more charitable organizations for a specified period of time. At the end of this period, any remaining assets in the trust are typically distributed to the granter's designated beneficiaries, such as family members. One of the key benefits of establishing a California Inter Vivos Granter FLAT is the potential reduction of estate and gift taxes. By transferring assets into the trust, the value of the assets is removed from the granter's estate, potentially minimizing estate taxes upon their death. Additionally, the granter can also receive an income tax deduction for the value of the charitable annuity payments made during the trust's term. There are several variations of California Inter Vivos Granter Charitable Lead Annuity Trust, each with its own attributes and benefits. Some common types include: 1. Non-Grantor FLAT: In this variant, the trust is not included in the granter's estate for tax purposes, resulting in potential estate tax savings. 2. Flip FLAT: This type of trust allows for a transition of the trust's status from a charitable lead trust to a non-charitable trust, typically benefiting the granter or their family members after a specified period of time. 3. Reverse FLAT: Unlike the traditional FLAT, where the charity receives annual annuity payments, a reverse FLAT structure provides for annuity payments to the granter initially, followed by the charity receiving the remaining assets. 4. Granter Retained Annuity Trust (GREAT): Although not specifically a FLAT, a GREAT is another type of charitable trust that operates similarly. It allows the granter to retain an annuity payout while benefiting a charitable organization in the long run. In conclusion, the California Inter Vivos Granter Charitable Lead Annuity Trust is a specialized charitable trust that serves to support charitable organizations while providing tax advantages for the granter. Understanding the different variations and their implications can help individuals make informed decisions when establishing such a trust.
