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.
Palm Beach, Florida is a renowned location known for its pristine beaches, luxurious lifestyle, and affluent residents. It also serves as a hub for various estate planning tools and strategies, one of them being the Inter Vivos Granter Charitable Lead Annuity Trust (FLAT). A Palm Beach Inter Vivos Granter Charitable Lead Annuity Trust is a common estate planning instrument that allows individuals to make charitable contributions while simultaneously benefiting their heirs. This trust involves a granter, charity beneficiaries, and non-charitable beneficiaries, typically family members. The Inter Vivos aspect of this trust means it is established during the granter's lifetime, as opposed to a testamentary trust set up through a will. Being a granter trust, the individual establishing the trust, known as the granter, retains certain rights and control over the trust assets during their lifetime. The Charitable Lead component of the trust signifies that a charitable organization receives annual payments or annuities from the trust for a predetermined period. This period can last for a specified number of years or until the granter's death. The charity chosen may be one of the granter is passionate about, enabling them to support impactful causes in their community or beyond. Simultaneously, the Annuity feature ensures that non-charitable beneficiaries, such as family members, receive the remaining trust assets after the charitable annuity payments conclude. These beneficiaries benefit from the potential growth and appreciation of the trust assets during the charitable period while enjoying reduced estate and gift tax consequences. In Palm Beach, there are several variations of the Inter Vivos Granter Charitable Lead Annuity Trust, each catering to different estate planning needs. Some common types include: 1. Term Charitable Lead Annuity Trust (Éclat): This structure allows thegranterr to determine a fixed term (typically a certain number of years) during which charitable annuity payments will be made. At the end of this period, the remaining trust assets pass to the non-charitable beneficiaries. 2. Flip Charitable Lead Annuity Trust (FLIP-CLAT): This type of trust allows the granter to dictate specific triggering events that would change the trust's payment structure. It begins as a charitable lead annuity trust, but if certain conditions defined by the granter occur, it converts into a non-charitable lead trust or a different type of trust, giving the granter more control over the ultimate distribution. 3. Unit rust Charitable Lead Annuity Trust (UCLA): In this variation, the annual charitable payments to the charity are recalculated based on a fixed percentage of the trust's value, which is revalued annually. This means that if the trust assets grow, the charitable payments increase, potentially benefiting both the charity and the non-charitable beneficiaries. Establishing a Palm Beach Inter Vivos Granter Charitable Lead Annuity Trust requires careful consideration, professional expertise from estate planning lawyers or advisors, and adherence to applicable tax laws. Its flexibility makes it an attractive option for individuals seeking to support philanthropic causes while benefiting their loved ones and potentially minimizing taxes.Palm Beach, Florida is a renowned location known for its pristine beaches, luxurious lifestyle, and affluent residents. It also serves as a hub for various estate planning tools and strategies, one of them being the Inter Vivos Granter Charitable Lead Annuity Trust (FLAT). A Palm Beach Inter Vivos Granter Charitable Lead Annuity Trust is a common estate planning instrument that allows individuals to make charitable contributions while simultaneously benefiting their heirs. This trust involves a granter, charity beneficiaries, and non-charitable beneficiaries, typically family members. The Inter Vivos aspect of this trust means it is established during the granter's lifetime, as opposed to a testamentary trust set up through a will. Being a granter trust, the individual establishing the trust, known as the granter, retains certain rights and control over the trust assets during their lifetime. The Charitable Lead component of the trust signifies that a charitable organization receives annual payments or annuities from the trust for a predetermined period. This period can last for a specified number of years or until the granter's death. The charity chosen may be one of the granter is passionate about, enabling them to support impactful causes in their community or beyond. Simultaneously, the Annuity feature ensures that non-charitable beneficiaries, such as family members, receive the remaining trust assets after the charitable annuity payments conclude. These beneficiaries benefit from the potential growth and appreciation of the trust assets during the charitable period while enjoying reduced estate and gift tax consequences. In Palm Beach, there are several variations of the Inter Vivos Granter Charitable Lead Annuity Trust, each catering to different estate planning needs. Some common types include: 1. Term Charitable Lead Annuity Trust (Éclat): This structure allows thegranterr to determine a fixed term (typically a certain number of years) during which charitable annuity payments will be made. At the end of this period, the remaining trust assets pass to the non-charitable beneficiaries. 2. Flip Charitable Lead Annuity Trust (FLIP-CLAT): This type of trust allows the granter to dictate specific triggering events that would change the trust's payment structure. It begins as a charitable lead annuity trust, but if certain conditions defined by the granter occur, it converts into a non-charitable lead trust or a different type of trust, giving the granter more control over the ultimate distribution. 3. Unit rust Charitable Lead Annuity Trust (UCLA): In this variation, the annual charitable payments to the charity are recalculated based on a fixed percentage of the trust's value, which is revalued annually. This means that if the trust assets grow, the charitable payments increase, potentially benefiting both the charity and the non-charitable beneficiaries. Establishing a Palm Beach Inter Vivos Granter Charitable Lead Annuity Trust requires careful consideration, professional expertise from estate planning lawyers or advisors, and adherence to applicable tax laws. Its flexibility makes it an attractive option for individuals seeking to support philanthropic causes while benefiting their loved ones and potentially minimizing taxes.
