Charitable Remainder Trust

Planning for the future - for you and your communityt

Giving through a Charitable Remainder Trust allows you to receive income for the rest of your life, knowing that whatever remains will benefit your community.


How it works

• You transfer cash, appreciated stocks, real estate, or other assets into a trust.

• You receive an immediate charitable tax deduction for the charitable portion of your trust.

• The trust pays you or a beneficiary you designate regular income payments.

• Upon the beneficiary’s death or after a defined period of years, the remaining assets in the trust transfer to the Del Mar Foundation. • Your gift is recognized in the Legacy Society in your name, in the name of your family or business, or in honor of any person or organization you choose.

• We handle all the administrative details after the gift is established.

• Your gift can be placed into an endowment that is invested over time. Earnings from your gift are used to make grants addressing community needs. Your gift—and all future earnings from your gift—is a permanent source of community capital, helping to do good work forever.

 

More benefits

You may choose to receive a fixed income or one that changes with market conditions— income from the Charitable Remainder Trust you establish may add up to more than the interest and dividends you earned from holding the assets. You can use it to supplement your own lifestyle or that of someone other than yourself: a sibling, a dependent parent, a friend, or a former employee.

A portion of the income may be a tax-free return of principal, while some is taxed as
ordinary income or capital gains. The amount of income received depends on the
payout rate selected by the donor. The tax deduction allowed depends on the age of
the recipient, the payout rate, and the discount rate (as determined by the Internal Revenue Service).

You can pick one of these options for your Charitable Remainder Trust:

• Annuity trust pays you a fixed dollar amount.

• Standard unitrust pays you an amount equal to a fixed percentage of the net fair market of the trust and is recalculated annually.

• Net income unitrust pays you the lesser of the fixed percentage specified by the trust agreement or actual trust income; some net income unitrusts allow you to make up deficiencies in past years.

• Flip unitrust is a net income unitrust that converts to a standard

A gift that pays


John Hill was retired and
in his late seventies. The stocks he owned had high market values, but they paid limited
dividends. In addition to
increasing his personal income, John was interested in giving
to the community in which he had lived his entire life, so he decided to transfer the securities to a Charitable Remainder Trust that eventually would create a gift with the Del Mar Foundation. “The income I receive from the trust is more than what I was collecting in annual dividends—by thousands
of dollars. If I would have sold the stocks, I’d have paid a fortune in capital gains tax,” says John. John also receives an immediate charitable deduction and pays less tax on the trust distributions. “Plus,” he says, “I know that when I pass, I’ve done something good.” In time, the Hill Family gift will address ever-changing community needs.

This is a donor scenario, a realistic composite of giving stories. It is not an actual Del Mar donor story.

 

Print Version

Click here for a pdf version of this page, suitable for printing.