A Charitable Remainder Trust (CRT) is a great way to donate your personal assets to charitable organizations you care about – while also providing you with, potentially, considerable relief from capital gains taxes.
To establish a CRT, you transfer appreciated assets like stock shares and real estate into an irrevocable trust. This removes these assets from your personal estate so no estate taxes will be due on them when you die. You also receive an immediate charitable income tax deduction on the current value of these contributions.
The CRT trustee (whom you can designate when establishing the CRT) then sells the asset at full market value, paying no capital gains tax, and reinvests the proceeds in income-producing assets. For the rest of your life, the trust pays you an annual income. You can decide when exactly in the future to begin taking that income. When you die, the remaining CRT assets go to the charities you have chosen – hence the term Charitable Remainder Trust.
Establishing a CRT reduces your income taxes now and estate taxes when you die. You pay no capital gains tax when the asset is sold. It also lets you provide support for one or more charities that have special meaning to you.
A CRT may be appropriate for you and your family. We here at Halbert Hargrove would be happy to discuss this further with you to see if it is.
Halbert Hargrove Global Advisors, LLC (“HH”) is an SEC registered investment adviser located in Long Beach, California. Registration does not imply a certain level of skill or training. Additional information about HH, including our registration status, fees, and services can be found at www.halberthargrove.com. This blog is provided for informational purposes only and should not be construed as personalized investment advice. It should not be construed as a solicitation to offer personal securities transactions or provide personalized investment advice. The information provided does not constitute any legal, tax or accounting advice. We recommend that you seek the advice of a qualified attorney and accountant. All opinions or views reflect the judgment of the author as of the publication date and are subject to change without notice. All information presented herein is considered to be accurate at the time of writing, but no warranty of accuracy is given and no liability in respect of any error or omission is accepted.