November 16, 2022

Generosity – Creating an estate plan that leaves a lasting legacy. 

Are you thinking about how you can give more generously and strategically to your family and beloved charities? As you create your estate plan and begin thinking about leaving a lasting legacy, you might want to consider all of your options. 
If you own real estate, a second home, or other rental properties: you might be concerned that selling any of those can generate an enormous amount of taxes, especially if you’ve depreciated the basis in any of those properties to zero. If this is your story, then you might want to consider using a Charitable Remainder Trust (CRT). 

What is a CRT?

A CRT is an irrevocable trust that generates a potential income stream for you or other beneficiaries with the remainder of the donated assets going to your favorite charity or Donor Advised Fund (DAF). This charitable giving strategy generates income and can enable you to pursue your giving goals while also helping to provide for living expenses. Charitable Trusts can offer flexibility and some control over your intended charitable beneficiaries as well as lifetime income, thereby helping you with retirement, estate planning, and tax management.  

Tax advantages of a CRT

  1. No capital gains tax is associated with the transfer of the asset
  2. Immediate charitable tax credit
  3. The asset will not be subject to an estate tax at the time of the donor’s death (it belongs to the charity at that time) 
If you’re interested in a CRT, feel free to reach out to our team of advisors, or contact a local state attorney. If you’re interested in having a trusted advisor help you make a plan for your generosity, please schedule an intro call with one of our consultants. 
The comments above related to the tax impact of charitable giving and impact of the recent IRS announcements are based on our best understanding, but you should consult with your CPA to determine the impact in your unique situation. All investment carries risk, and we cannot guarantee performance or results. Please contact us for any questions relating to the content above, or to discuss your specific situation.
By Published On: November 17th, 2022

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About the Author: Tara Bruce

Tara Bruce
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