A Charitable Remainder Trust
(CRT) is an irrevocable trust arrangement that can benefit both you (or others
you designate) and your favored charity(ies). A typical CRT might look like
1) you contribute property
(cash, investments, real estate to be sold) to the trust
2) you receive a tax deduction for
charitable gift (not the same amount as what you contributed)
3) you can receive an income
from the trust for a fixed term or for life
4) a designated charity receives
the “remainder” at the end of the trust term or when you die
A CRT is both an estate
planning and charitable giving tool, but it has nothing directly to do with
your will. A CRT can present an
interesting opportunity for someone with highly-appreciated assets to donate
those to the trust and not have to pay capital gains tax, while eventually
benefiting their favored charity.
Since you wondered if a CRT
was “something that goes along with my will,” perhaps you have it confused with
a Revocable Living Trust (RLT). An RLT is often set-up in concert with the
drafting of one’s will. An RLT allows your estate to bypass probate, may save
your estate money in the end, and provides privacy in how your estate is
Nobody should ever advise that
you do or don’t need an RLT or a CRT without first having a thorough
understanding of what’s important to you (your values) and your overall
I hope that helps.
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