Charitable Remainder Unitrust

A charitable remainder unitrust (CRUT) is a separately invested and managed charitable trust that pays a percentage of its principal, re-valued annually, to you and/or other income beneficiaries you name for life or a term of years (up to a maximum of 20). You receive a charitable income tax deduction for a portion of the value of the assets you place in the trust. After the trust terminates, the balance is transferred to Berkshire to be used as you designate.

How does it work?

  • Berkshire provides you and your attorney with a draft trust instrument.
  • You irrevocably transfer cash, securities, or other property to fund the trust.
  • You receive an income tax deduction and pay no capital gains tax on the transfer.
  • During its term, the trust pays a percentage of its value each year to you and/or other beneficiaries you have named.
  • When the trust ends, its remaining principal is transferred to Berkshire.

What are the benefits?

  • Offers you maximum flexibility for the gift, including choosing your payment percentage (5%-6% is typical), the person or entity who administers your gift and guides its investments, and the trustee (which could be Berkshire).
  • Has the potential to reduce your income taxes now and estate taxes later.
  • You pay no capital gains tax when the asset used to fund the CRUT is sold.
  • Allows you to retain or increase your income and make a significant impact at Berkshire.

The best assets to fund a CRUT are those that have greatly appreciated in value since you purchased them, specifically publicly traded securities, real estate and stock in some closely-held corporations.

The CRUT will be re-valued at the beginning of each year to determine the dollar amount of income you will receive. If you prefer to receive a fixed income, regardless of the trust's performance, a charitable remainder annuity trust (CRAT) might be the right option for you.

Charitable Remainder Annuity Trust

A Charitable Remainder Annuity Trust (CRAT) enables you to make a gift that provides income for you now, and supports Berkshire in the future. You will receive a determined percentage of the trust each year, and when the term ends, Berkshire will receive the balance.

Charitable Lead Trust

A charitable lead trust (CLT) pays income to Berkshire now, while reducing your tax costs for transferring assets to your heirs. With a charitable lead trust, you irrevocably transfer assets to a trustee and stipulate that payments will be made to Berkshire for a specified number of years or until the end of your or another’s life. Then the principal is passed along to your designated heirs at greatly reduced gift and estate tax rates.