Charitable Trusts

A charitable trust is a flexible way to meet your current and long-term financial and philanthropic objectives. Through a charitable trust, a donor places cash, stock, real estate, or other assets into a charitable trust, which is invested and managed by a professional financial institution (i.e., Trustee) of the donor’s choice. Once created, a charitable trust is irrevocable. Charitable trusts take two forms — charitable remainder trusts and charitable lead trusts.

Charitable Remainder Trusts

A charitable remainder trust allows you to designate the beneficiary of regular payouts from trust proceeds (for either a fixed dollar amount or a fixed percentage) during your lifetime or for a period of time, not to exceed twenty years. At the same time, the Clinton Foundation is designated a remainder beneficiary. This allows you to claim a tax deduction for the estimated portion of the assets that will ultimately go to the Foundation upon death or the expiration of the fixed period.

Charitable Remainder Annuity Trusts

A charitable remainder annuity trust will furnish you — or someone you designate — with a fixed annual income for life or for a pre-determined number of years (up to twenty). The payment amount — which you determine when you establish the trust — must be at least five percent of the initial gift amount. That amount will not change over the life of the trust. This will appeal to those who want the security of a fixed amount each year. When the trust is created, you may claim a charitable deduction based on the value of the asset used to establish the trust.

Charitable Remainder Unitrusts

A charitable remainder unitrust provides annual payments that will fluctuate from year to year, as the payment is based on the earnings of the investments in the trust. When the trust is created, you select the fixed payout percentage, which must be at least five percent of the initial gift amount. The annual payment is based on a percentage of the trust’s value as calculated each year. When the trust is created, you may claim a charitable deduction based on the value of the asset used to establish the trust.

Charitable Lead Trusts

Charitable lead trusts appeal to individuals who wish to make a gift but retain the property. These irrevocable trusts are, essentially, the reverse of charitable remainder trusts in that the payments from a charitable lead trust will first come to the Bill, Hillary & Chelsea Clinton Foundation for a specific period of time, usually between 10 and 20 years, after which time the principal of the trust will revert to you and/or to those you have designated, typically your children or grandchildren.