Charitable Remainder Trust
Solutions for Large Donations
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If you have built a sizable estate and are looking for ways to receive reliable payments, consider a charitable remainder trust.
These types of gifts may offer you tax benefits and the option for income. There are two ways to receive payments and each has its own benefits:
The annuity trust pays you, each year, the same dollar amount you choose at the start. Your payments stay the same, regardless of fluctuations in trust investments.
The unitrust pays you, each year, a variable amount based on a fixed percentage of the fair market value of the trust assets. The amount of your payments is recalculated annually. If the value of the trust increases, so do your payments. If the value decreases, however, so will your payments.
*A charitable remainder trust may have gift and estate tax benefits. Step Up For Students does not offer charitable remainder trusts. Please seek the advice of your financial or legal advisor to learn about the costs and benefits of charitable remainder trusts and if it is right for you.
An Example of How It Works
A 65-year-old woman wants to make a gift to a nonprofit like Step Up but would also like more income in the future. She creates a charitable remainder unitrust with annual lifetime payments to her equal to 6 percent of the fair market value of the trust assets as revalued annually. She funds the trust with assets valued at $500,000.
She receives $30,000 the first year from the trust. Subsequent payment amounts vary each year depending on the annual valuations of the trust assets. She is eligible for a federal income tax charitable deduction of $276,880* in the year she creates and funds the trust. This deduction saves her $88,232 in her 32 percent tax bracket.
*Based on annual payments and a 3.2 percent charitable midterm federal rate. Deductions and calculations will vary depending on your personal circumstances.
- Contact Elizabeth L. Watson at (407) 491-7429 or firstname.lastname@example.org to talk about supporting Step Up by setting up a charitable remainder trust.
- Seek the advice of your financial or legal advisor.
- If you include Step Up in your plans, please use our legal name and federal tax ID (59-3649371).
Legal Name: Step Up For Students
Address: 4655 Salisbury Road, Suite 400, Jacksonville, FL 32256
Federal Tax ID Number: 59-3649371