Charitable Remainder Annuity Trust
If you want a fixed income, then consider funding a charitable remainder annuity trust (CRAT) for one or more individuals. The trust may last for the lifetime of the beneficiaries or for a term of years. When the trust ends, the principal passes to Ohio Northern University.
Through the use of the CRT, you may be able to achieve one or more of the following goals:
- Increased income from low-yielding assets.
- Reduction or elimination of income, estate and gift taxes.
- Diversification of investments.
- Creation of a source of income for children or other loved ones.
- The enjoyment of making a gift that might not otherwise be possible.
- When your gift to Ohio Northern University is $10,000 or more, you will be invited to join the Heritage Club.
How does a charitable remainder annuity trust work?
As the donor, you transfer property (cash or other assets) to a trust that meets federal and state laws. The trustee invests, manages and distributes the assets according to the terms of the trust document.
You may specify that payments from the trust be made to you or one or more other persons for life or for a certain time period.
The amount of income received may be fixed at the time the trust is created.
Annuity trusts generate federal income-tax charitable deductions, based on the present value of the remainder interest that ultimately passes to ONU.
At the end of the trust period, the property remaining in the trust (the charitable remainder) becomes the property of ONU.
Because property transferred to the trust will be used for charitable purposes in the future, gift, estate and income tax deductions are allowed in the year of the gift for the value of the gift portion transferred to the trust.
Through a charitable remainder trust, you can enhance your retirement income while enjoying the fact that the funds remaining when the trust ends will be devoted to the betterment of ONU as you choose.