Home >> Advanced Plans       C.    Charitable Remainder Trust (CRT) 1.    Primary Features -     i) grantors forfeit control after inception of trust     ii) provides lifetime income distributions to grantor (and surviving spouse)     iii) can convert low-interest yield asset to income producing asset     iv) provides a highly-leveraged method of benefiting favorite charities     v) removes transferred value from grantor's estate for tax purposes3 2.    Asset Transfers -     i) inbound transfers are usually appreciated real estate / stock portfolios     ii) inbound spousal transfers are usually allowed     iii) takes legal title to all transfers and sells appreciated assets (w/o tax)     iv) soon able to receive IRA transfers without taxable event     v) qualified 501(c) transferees include public and/or private foundations 3.    Taxable Events / Benefits -     i) inbound grantor transfers are not taxable, now also including IRAs     ii) most inbound grantor transfers generate income4 and gift tax deductions     iii) sale of appreciated property in trust does not incur capital gains tax     iv) outbound remainderman transfers are not taxable - to charitable entities     v) may deem capital gain inside trust as income for distribution purposes 4.    Management Structures -     i) s/b corporate-trustee managed throughout term of trust     ii) trustee manages assets in event of incapacitation - w/o conservatorship     iii) registered corporate trustee management is recommended     iv) may utilize an institutional investment advisor to trustee     v) requires special accounting methods including four-tier allocations

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