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Protect Your Assets

You can benefit from the tax savings that result from supporting the Unitarian Universalist Association without giving up the assets that you would like your family to receive someday with a donation in the form of a charitable lead trust.

There are two ways that charitable lead trusts make payments to the UUA:

A charitable lead annuity trust pays a fixed amount each year to the UUA and is more attractive when interest rates are low.

A charitable lead unitrust pays a variable amount each year based on the value of the assets in the trust. With a unitrust, if the trust's assets go up in value, for example, the payments to the UUA go up as well.

An Example of How It Works

Man smilingAndy would like to support the UUA and provide for his children. Following his advisor's recommendation, Andy funds a charitable lead annuity trust with assets valued at $2,500,000.

Andy's trust pays $175,000 (7 percent of the initial fair market value) to the UUA each year for 15 years, which will total $2,625,000. After that, the balance in the trust goes to his children. Assuming a 6 percent investment return, the children will receive approximately $1,918,101.

His gift tax deduction is $2,182,775* against the $2,500,000 of assets. Therefore, only the difference ($317,225) is subject to gift tax, which is offset against his lifetime gift tax exclusion. After that, the remaining trust assets and all of their growth will pass to his family at zero additional cost in gift and estate taxes. Had Andy given the $2,500,000 outright to his children, it would have been a taxable gift.

*Assuming annual payments and a 2.4 percent charitable midterm federal rate.

Discover Gifts That Pay

Your payments depend on your age at the time of the donation. If you are younger than 65, we recommend that you learn more about your options and download this FREE guide Plan for Retirement With a Deferred Gift Annuity.

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