Life Income Gifts - Wilkes Pays You for the Rest of Your Life
A CHARITABLE REMAINDER ANNUITY TRUST, or CRAT, is a trust that will pay the donor (and one or more other named beneficiaries, if desired) a specified annuity income for life or a period of time not to exceed 20 years. The amount of the annuity is a fixed amount chosen by the donor at the time the trust is established and is paid at least annually. The annuity paid cannot be less than 5 percent of the initial fair market value of the trust.
A CHARITABLE REMAINDER UNITRUST, or CRUT, has many of the same attributes as a CRAT, but with more flexibility and planning opportunities. The primary difference is that the payout is a fixed percentage (not less than 5 percent) of the market value of the trust assets as determined annually. While the percentage cannot be changed, the amount paid out may increase (or decrease) over time. Additional contributions can be made to a CRUT over time, and there are several income variations that can be used with creative planning possibilities, such as to save for retirement or to educate grandchildren in college.