What is a charitable remainder trust?
A charitable remainder trust is a type of irrevocable trust. This means once the trust documents have been created, full control of the trust and its assets are handed over to the beneficiary and are no longer in control of the person who has set up the trust (the grantor).
Contributing to one of these trusts reduces your taxable income and can benefit a philanthropy of your choosing.
How does a charitable remainder trust work?
Charitable remainder trusts allow you to irrevocably transfer trust assets.
You and/or your beneficiaries receive payments from the trust for life or a set period of time.
The remainder of the trust is then donated to a predetermined charity, like St. Jude Children's Research Hospital.
Charitable remainder trusts:
There are two main types of charitable remainder trusts: charitable remainder annuity trusts and charitable remainder unitrusts. The two are differentiated by the way they pay out to the beneficiary.
Charitable remainder annuity trust (CRAT)
A charitable remainder annuity trust (CRAT) pays a set income amount to beneficiaries for life or for a predetermined number of years. Once the CRAT has been established, additional gifts cannot be made.
Charitable remainder unitrusts (CRUT)
A charitable remainder unitrust (CRUT) pays a set percentage rate to beneficiaries for life or for a predetermined number of years. The annual income amount is based on the trust’s current value, so the payout can increase or decrease depending on how that value changes over time.
Charitable remainder trusts offer the following benefits:
- Once you set up the CRT, you and/or your beneficiaries receive payments from the trust for life or a set period of time.
- Setting up a CRT may reduce or even eliminate gift and estate taxes on trust assets passing to family. Future gift assets to your loved ones will be valued on the date you establish the trust. So if the gift appreciates in value, your family wouldn’t have to pay taxes on it later.
- You may not be taxed on income earned by the trust. Other tax benefits vary and you should ask your financial advisor for more information.
- St. Jude or other favorite charities can benefit from receiving annual distributions from the trust and you can see the impact of your gifts.
ALSAC/St. Jude Children’s Research Hospital does not provide tax, legal or accounting advice. This material is prepared and made available to you for informational purposes only and is not intended to provide or be relied upon for tax, legal or accounting advice. You should always consult a tax professional to determine your particular tax benefits that may result from any particular type of gift to charity.
Tax ID Number:
We are a tax-exempt, charitable institution listed in the Federal Internal Revenue Service Publication #78, "Cumulative List of Organizations," revised IRS Code 501(c)(3).
Why donate to St. Jude?
Families never receive a bill from St. Jude for treatment, travel, housing or food — so they can focus on helping their child live.
When St. Jude opened in 1962, childhood cancer was considered largely incurable. Since then, St. Jude has helped push the overall survival rate from 20% to more than 80%, and we won't stop until no child dies from cancer.
Every child deserves a chance to live their best life and celebrate every moment. When you support St. Jude, you can help make cures possible for kids with cancer. Together, we can save more lives.
Our Gift Planning department has a representative in your area who can provide further information or help you prepare the right questions to ask your financial advisor to determine what type of planned gift may be right for you.
Email email@example.com, call (800) 395-1087, or fill out the form below, and a St. Jude representative will contact you.
Have you left St. Jude in your will or estate plan?
As an acknowledgment of your generosity when you give a gift to St. Jude through your will or estate plan, you become a member of the Danny Thomas – St. Jude Society, and we recognize your commitment to the mission of St. Jude in a variety of ways.
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