Charitable remainder trusts (CRTs)
Tailor income streams, diversify assets, and leave a lasting legacy through the flexibility of a charitable remainder trust (CRT).
Photograph by Gary Sexton. Image courtesy of the Fine Arts Museums of San Francisco
About charitable remainder trusts (CRTs)
A charitable remainder trust (CRT) is a planned giving tool that allows donors to make a significant charitable impact while also providing financial benefits to themselves or their beneficiaries.
This type of trust is an irrevocable arrangement in which a donor transfers assets into a trust that is managed and invested by a trustee. The trust pays income to designated beneficiaries for a set number of years or their lifetime, after which the remaining assets are distributed to charity.
Types of CRTs
Charitable remainder annuity trust (CRAT):
- Fixed income stream based on a percentage of the initial asset value
- Income stream that does not change over time
Charitable remainder unitrust (CRUT):
- Variable income stream based on a percentage of the trust’s value, revalued annually
- If assets appreciate over time, the income stream will also increase
Benefits
- Reduce or eliminate capital gains taxes.
- Retain an income stream for yourself or your beneficiaries.
- Create a lasting legacy that supports our mission.
How it works
- Transfer assets (such as cash, securities, or real estate) into a trust, which a trustee manages.
- The trust pays income to your designated beneficiaries (such as you, your spouse, or other individuals) for a set number of years or for their lifetime.
- At the end of the trust term, the remaining assets are distributed to one or more charitable organizations.
- You receive an income tax deduction for the present value of the charitable remainder interest in the trust.
- You may also be able to avoid or reduce capital gains taxes on appreciated assets that are transferred into the trust.
We recommend consulting with a qualified estate planning attorney and a financial advisor to determine if this option is right for you.
Already included us in your estate plans?
Letting us know is incredibly helpful to our team and helps make sure your gift is used how you want it to be.
Have questions? Get in touch!
Our team is happy to speak with you about your giving goals, confidentially and with no obligation.Name:
Contact us through this form or at plannedgiving@famsf.org.
More ways to make an impact
Gifts for the future
Donations in your will or trust are the most popular type of legacy gift, while gifting assets not covered by your will, like 401(k) or IRA accounts, may help your heirs avoid unwanted taxes.
Gifts that pay you back
Transfer securities, cash, or other property to the Museums and we’ll manage the investment of the assets and pay an income to you, your designated beneficiaries, or both. Receive payments for the rest of your life or up to a certain number of years.
Tax-smart gifts
Many people are increasingly choosing to give non-cash assets, so they can have a bigger impact at less cost to them.