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Charitable Remainder Unitrusts
(Gift example*)
You are considering a gift to Exeter of $250,000, but you are concerned about the capital gains consequences of liquidating assets, and reducing your and your spouse's cash flow.
You and your spouse, ages 70 and 68, own a small commercial building that has doubled in value and consequently generated several offers to purchase. You decide to place the building into a net-income unitrust that will pay 5% of the trust's value for your lifetime (initially from the rental income from the building, then a percentage of the proceeds of its sale) to the two of you. The remainder of the unitrust will go to Exeter .
What are your benefits?
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Comparison
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Unitrust
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Private Sale
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Amount transferred
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$250,000
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$250,000
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Capital Gains Tax (@15%):
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0
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$18,750
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Net for reinvestment
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$250,000
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$231,250
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First year's income
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$12,500
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$11,562
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Charitable deduction
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$101,935
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0
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Tax savings @ 33% rate
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$33,639
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0
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Total benefit, first year
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$46,139*
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$11,562
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Unitrust payment plus tax savings from charitable deduction
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Click here to calculate the benefits a unitrust would give you.
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*This example is based on a factor that changes monthly. Contact our office for a personal illustration based on the latest rates.
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Note: The Unitrust is not the only gift plan that pays you lifetime income. Compare its benefits with those of the annuity trust and the gift annuity.
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For more information
Email us, complete the personal illustration form, or call us at (603) 777-3667 so that we can assist you through every step of the process.
Chris Wronsky
Director of Planned Giving
Phillips Exeter Academy
20 Main Street
Exeter, NH 03833
(603) 777-3594
Fax (603) 777-4201
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