Estate planning isn’t just about protecting assets—it’s about creating a meaningful legacy. Charitable Lead Trusts (CLTs) and Charitable Remainder Trusts (CRTs) offer a unique opportunity to balance your philanthropic goals with tax-efficient wealth transfer to your heirs.
Here’s how these strategic tools work:
Charitable Lead Trusts (CLTs)
A CLT allows you to set aside assets that generate income for a charity of your choice for a set number of years. Once the trust term ends, the remaining assets are passed on to your heirs, often with significant tax benefits.
Key Benefits of a CLT
- Immediate Philanthropic Impact: You can fund a cause you care deeply about while retaining control over how the funds are distributed.
- Estate and Gift Tax Reduction: Transferring assets through a CLT can lower the taxable value of your estate.
- Preservation of Family Wealth: After the charitable term ends, your heirs receive the remaining assets, potentially with reduced tax implications.
Charitable Remainder Trusts (CRTs)
A CRT flips the script. You or your beneficiaries receive income from the trust for a set period or for life. When the trust term ends, the remaining assets are donated to the charity.
Key Benefits of a CRT
- Tax-Advantaged Income: You receive income while deferring capital gains taxes on appreciated assets.
- Support for Future Generations: Structured payouts can provide for your family during their lifetimes.
- Philanthropic Legacy: Upon the trust’s termination, your chosen charity receives the remaining assets.
Strategic Planning Is Essential
Both CLTs and CRTs require careful planning to ensure compliance with IRS regulations and alignment with your long-term goals. Working with a qualified estate planning professional can help you customize the trust terms to maximize benefits for your family and the charities you support.
We specialize in helping clients design Oklahoma estate plans that reflect their values and aspirations.