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.
Tarrant Texas Inter Vivos Granter Charitable Lead Annuity Trust is a type of charitable trust established by a granter during their lifetime. This trust serves the purpose of providing income to a charitable organization for a specified period while eventually transferring the remaining assets to non-charitable beneficiaries. The Tarrant Texas Inter Vivos Granter Charitable Lead Annuity Trust allows the granter to make a significant contribution to a charitable cause while still retaining some control over the assets and benefiting their chosen non-charitable beneficiaries. This trust structure is popular among individuals seeking to maximize charitable giving and minimize potential estate tax burdens. There are several types of Tarrant Texas Inter Vivos Granter Charitable Lead Annuity Trusts, including: 1. Charitable Lead Annuity Trust (FLAT): In this trust, a fixed amount or annuity is paid to the charitable organization each year for the specified term, with the remaining assets reverting to the non-charitable beneficiaries at the end of the period. 2. Flip Charitable Lead Annuity Trust: This type of trust allows the granter to initially receive income from the trust for a specified period. Afterward, the trust "flips" to become a charitable lead trust, providing income to the designated charitable organization. 3. Non-Flip Charitable Lead Annuity Trust: Unlike the flip trust, the non-flip trust does not change its structure during the term. The charitable organization receives fixed annuity payments, and any remaining assets pass to the non-charitable beneficiaries at the termination of the trust. 4. Granter Retained Annuity Trust (GREAT): Although similar to a charitable lead annuity trust, a GREAT allows the granter to receive income payments for a predetermined term. After the term ends, the remaining assets are transferred to non-charitable beneficiaries, such as family members, with potential estate tax benefits. Tarrant Texas Inter Vivos Granter Charitable Lead Annuity Trusts offer a flexible and tax-efficient strategy to support charitable causes while preserving family wealth. Talk to a qualified estate planning attorney or financial professional to understand the specific benefits and considerations of establishing this type of trust in Tarrant, Texas.
