Charitable Lead Trusts
Goal: Pass assets to heirs at potential tax savings
Benefit: Charitable tax deduction, favorable estate tax circumstances
Phil and Alicia had a successful business developing both residential
and commercial real estate. They realized that their assets provided more
income than they need for their family's current living expenses; however
they wanted to maintain their assets to ensure their grandchildren would
have resources for college educations. One of their first charitable gifts
had been a gift of appreciated stock.
They discussed their circumstances with their financial advisor who showed
them how they could make a charitable gift now and be able to enjoy seeing
the results while they were still here.
Phil: "It really has been a wonderful ride. When we first started
developing residential housing, we had no idea where it would all lead.
We were fortunate to make some choices that really set up the company
for success. It's grown beyond our wildest dreams."
Alicia: "We have been able to provide a wonderful home for
our children, but they are off on their own now with their own families.
While the company has grown, our immediate needs have shrunk."
Phil: "Not too long ago, we sat down with our kids and our
advisors and talked about what was important to us and what we really
wanted. Our kids are all doing fine on their own. We certainly don't need
more. Our attorney told us about something called a charitable lead trust
funded with some of our excess assets."
Alicia: "It sounded great to us - some tax benefits and our
estate remains intact for our grandchildren's' education. Not only are we helping
to make a difference in other people's lives, we're able to do
it while we're here and can be part of it. It really feels good to see
firsthand how the income from the trust can really make a difference."
Phil and Alicia wanted to contribute $250,000. They placed a sufficient
amount of income producing commercial property into a Charitable
Lead Trust (CLT) that would make annual payments of $25,000 over ten
years. This will provide the charity with $250,000 in total and after
ten years, the assets will pass to the donor's heirs. Because the gift
tax deduction and the amount subject to gift tax is determined at the
time the assets are contributed to the CLT, any appreciation of the assets
that takes place during the term of the trust is not subject to additional
gift or estate tax.
As we said earlier, there are as many ways to support Goodwill Suncoast
as there are needs for your support. Please contact
us should you have questions or if you would like to discuss your
personal circumstances to see how you can enrich your heart and the lives
of others as many have already done.
Return to the Legacy Giving home page or to the Quick Guide to Legacy Gifts.