![Termination of Charitable Remainder Trusts Termination of Charitable Remainder Trusts](https://eu-images.contentstack.com/v3/assets/bltabaa95ef14172c61/blt9da3b82e3a6e1ce5/67336d3d3a1491ef6acbb063/teitell-promo.jpg?width=1280&auto=webp&quality=95&format=jpg&disable=upscale)
Kenny Rogers could well have been singing about charitable remainder trusts (CRTs). Donors who create inter vivos CRTs want to: (1) provide life income for themselves (and sometimes also for a survivor); and (2) make a significant gift to charity on the CRT’s termination.
Federal tax law encourages generosity by giving itemizers an income tax charitable deduction for the value of their remainder interest. Capital gains are avoided on funding a CRT with appreciated property. Gains are taxable only to the extent that they’re deemed distributed to the life beneficiary under the 4-category taxation regime.
Almost all life beneficiaries keep their CRTs for their lifetime; they want life income. So, they hold ‘em.
But, change is inevitable (exce...
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