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 Harris Texas Inter Vivos Granter Charitable Lead Annuity Trust is a type of trust arrangement commonly utilized for estate planning purposes. It involves a granter setting up a trust during their lifetime (inter vivos) and naming a charitable organization as the recipient of annual annuity payments from the trust's assets. This charitable lead annuity trust is established with the aim of both benefiting charitable organizations and maximizing tax benefits for the granter. The Harris Texas Inter Vivos Granter Charitable Lead Annuity Trust offers several advantages for individuals in the state of Texas seeking to support charitable causes while efficiently managing their estate. By establishing this trust, the granter can contribute assets, such as cash, securities, or real estate, to fund the trust and immediately claim a charitable deduction on their income taxes. This deduction can help reduce the income or estate taxes owed by the granter, effectively optimizing their tax position. There are different types of Harris Texas Inter Vivos Granter Charitable Lead Annuity Trusts based on their terms and provisions: 1. Charitable Lead Annuity Trust (FLAT): In this type, the trust pays a fixed annuity amount to the designated charity annually for a predetermined term of years or for the granter's lifetime. At the end of the term, the remaining trust assets are either distributed back to the granter or passed on to other beneficiaries, such as family members. 2. Charitable Lead Unit rust (CLUB): Unlike a FLAT, a CLUB pays a fixed percentage of the trust's value, determined annually, to the charitable organization. The payment can either be a set percentage of the trust's initial value or recalculated each year based on the trust's current value. Once again, at the end of the trust term, any remaining assets can be distributed to the granter or other named beneficiaries. 3. Pooled Income Fund (PIF): A PIF is a charitable trust that allows multiple individuals to contribute assets into a common fund, managed together. The income generated by the trust is then distributed to the charitable organizations designated by the participants. By pooling resources, individuals can achieve greater investment diversification and potentially higher returns than they would individually. By utilizing a Harris Texas Inter Vivos Granter Charitable Lead Annuity Trust, individuals can support meaningful causes while enjoying potential tax advantages. The specifics of the trust, including the type chosen (FLAT, CLUB, or PIF), its terms, and the designated charitable organization, should be carefully considered in consultation with legal and financial professionals to ensure that it aligns with the granter's goals and circumstances.The Harris Texas Inter Vivos Granter Charitable Lead Annuity Trust is a type of trust arrangement commonly utilized for estate planning purposes. It involves a granter setting up a trust during their lifetime (inter vivos) and naming a charitable organization as the recipient of annual annuity payments from the trust's assets. This charitable lead annuity trust is established with the aim of both benefiting charitable organizations and maximizing tax benefits for the granter. The Harris Texas Inter Vivos Granter Charitable Lead Annuity Trust offers several advantages for individuals in the state of Texas seeking to support charitable causes while efficiently managing their estate. By establishing this trust, the granter can contribute assets, such as cash, securities, or real estate, to fund the trust and immediately claim a charitable deduction on their income taxes. This deduction can help reduce the income or estate taxes owed by the granter, effectively optimizing their tax position. There are different types of Harris Texas Inter Vivos Granter Charitable Lead Annuity Trusts based on their terms and provisions: 1. Charitable Lead Annuity Trust (FLAT): In this type, the trust pays a fixed annuity amount to the designated charity annually for a predetermined term of years or for the granter's lifetime. At the end of the term, the remaining trust assets are either distributed back to the granter or passed on to other beneficiaries, such as family members. 2. Charitable Lead Unit rust (CLUB): Unlike a FLAT, a CLUB pays a fixed percentage of the trust's value, determined annually, to the charitable organization. The payment can either be a set percentage of the trust's initial value or recalculated each year based on the trust's current value. Once again, at the end of the trust term, any remaining assets can be distributed to the granter or other named beneficiaries. 3. Pooled Income Fund (PIF): A PIF is a charitable trust that allows multiple individuals to contribute assets into a common fund, managed together. The income generated by the trust is then distributed to the charitable organizations designated by the participants. By pooling resources, individuals can achieve greater investment diversification and potentially higher returns than they would individually. By utilizing a Harris Texas Inter Vivos Granter Charitable Lead Annuity Trust, individuals can support meaningful causes while enjoying potential tax advantages. The specifics of the trust, including the type chosen (FLAT, CLUB, or PIF), its terms, and the designated charitable organization, should be carefully considered in consultation with legal and financial professionals to ensure that it aligns with the granter's goals and circumstances.
