Charitable Remainder Trust

A charitable remainder trust is a “split-interest” giving vehicle that enables people to pursue philanthropic goals while still generating income. Tax exempt and irrevocable, they are designed to reduce the taxable income of individuals. They are set up with a donation by the trustor (also known as “the grantor” or “the benefactor”) that provides a partial tax deduction. They then operate by dispensing income to either the trustor or one or more named noncharitable beneficiaries for a specified period of time, after which they donate the remainder of the trust to one or more designated charitable beneficiaries, which can be either a public charity or private foundation.