In this edition of our Legacy Moments newsletters, we’re going to take a little more focused turn on a specific vehicle that can be deployed to your legacy planning aims.  In our upcoming Homecoming celebration on October 5th, we’ll be hosting a time of information and interaction around this strategic tool – including some time we have arranged with a couple who have entered into one of these very straightforward agreements, for the utility they saw in it for themselves, in just this very way.

We’re speaking of a Charitable Remainder Unitrust (or “CRUT”), one of three primary types of Charitable Trusts, and by far the most favored for the way in which this design, first, benefits you! As the name for this Trust implies, a CRUT in its varied forms can be a valuable “two-way interest” solution to achieving a season of strategic income for you, and as those payments conclude, what remains (the “remainder” portion), can then form a gift to the ministries you cherish and have been impacted by.  As our seasoned legal counsel   would remind us, CRUT’s can often be very tax efficient - meaning it can help couples and families avoid or efficiently deal with different kinds of taxes ... including capital gains tax (at the establishment of the Trust), efficient and advantageous taxation during the Trust term (the “payment period”), and as the Trust terminates (when payments end), a favorable effect on the gift and estate tax that might have otherwise come into play. 

Resultantly, a CRUT can become a meaningful part of your retirement income portfolio, and even potentially endure the test of time, based upon the manner in which your agreement is stewarded by the Trustee you designate to that task (a role we can, and do play, as an operationally independent Foundation).  In summary, as one independent analysis cites  , “CRUT’s, as a means to funding your retirement income portfolio can truly often make economic sense”.  This analysis goes on to cite at least three reasons for this: First, “if the cost basis for what you intend to fund the CRUT with (what you originally purchased that asset at) is low, the valuation of the income you can expect to receive is often greater with the CRUT portion of your portfolio than with other more directly funded portions of your retirement income stream.”  Second, “the probability that you will receive your targeted income each year until the second person passes is greater with a CRUT funded income stream”.  Third, “the strategic valuation of your intended bequests from your estate (what you choose to leave to heirs) can often be substantially greater with that portion of your portfolio that is funded with a CRUT”.   

This edition of our Legacy Newsletters is brief, and maybe a bit of a deep dive, but only because we believe this discussion around CRUT’s is that important. If you can make it to Homecoming on October 5 through 7, we would love to see you at our Luncheon on Thursday, October 5.  We are going to seek to arrange to have this time recorded - and just maybe we can arrange a livestream for it as well.  

For more information on this year’s Homecoming’s events, click here: www.letu.edu/homecoming.