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Charitable Trusts

The Hadassah Family of Life Income Plans offers various charitable trusts such as remainder annuity trusts, charitable remainder unitrusts and charitable lead trusts lead trusts.

Minimum gift: $100,000 ($250,000 for Charitable Lead Trusts)
Minimum age: 60 (no minimum age for Charitable Lead Trusts)

The remainder trusts work in basically the same way:

Step 1 - you establish the trust and fund the trust with cash or property;

Step 2 - each year the trust pays you an annual annuity payment (fixed for the annuity trust, or variable for the unitrust) for either a set number of years or for the rest of your life.  

Want more information about the different types of trusts? Read on!

CHARITABLE REMAINDER ANNUITY TRUST

What is a charitable remainder annuity trust?

A charitable remainder annuity trust is a trust that pays a fixed dollar amount annually for life.

What are the details?

  • The minimum amount to establish a charitable remainder annuity trust is $100,000.
  • The minimum age to establish a charitable remainder annuity trust is 60.
  • he trust is irrevocable. You cannot get the principal back.
  • The trust can be established for a set term of years or for the rest of your life or lives if you and your spouse (or other persons) are both beneficiaries.
  • You will receive a substantial income tax deduction in the year you create your annuity trust.
  • If the gift is made with securities or real estate, you avoid all capital gains tax on the appreciated value.
  • At the end of the trust, Hadassah will use the amount remaining for its important work.

ANNUITY TRUST PLUS

What is a charitable remainder annuity trust plus?

The annuity trust plus is the same thing as a charitable remainder annuity trust, but it has one important addition. You will receive a guaranteed income for your life (or lives), and then your children or grandchildren will receive the same amount each year for an agreed upon number of years.

What are the details?

The same as for the annuity trust, plus the limit to the “plus” portion of the trust is 20 years.

Is an annuity trust plus right for you?

If you have children or grandchildren you’re concerned about, then the annuity trust plus might be right for you. Suppose future college tuition for your grand kids are an anxiety for your daughter, an annuity trust plus could ease some of those worries.

CHARITABLE REMAINDER UNITRUST

What is a charitable remainder unitrust?

A unitrust is a variation of the annuity trust. It differs from an annuity trust in that, instead of paying you a fixed dollar amount each year, it pays you a fixed percentage of the value of the trust assets each year.

What are the details?

  • The minimum amount for a unitrust is $100,000.
  • The minimum age is 60.
  • The unitrust was created for unique financial situations. It lets you participate in the trust’s financial performance. Each year the value of the trust is recalculated to take into account growth of the principal. You will share in that growth by receiving a fixed percentage of the principal plus interest. If there are losses in any year, the amount received will decrease for that year.

Is the unitrust right for you?

  • The unitrust is particularly good for those of you who wish to participate in the growth of your trust fund, and feel strongly about the potential long-term grown of the stock market.
  • It is also an ideal way to handle assets that have an uncertain current value but are expected to appreciate in the future, perhaps real estate which produces no income now but has the potential to become valuable, or those tech stocks that you still believe will rise again.
  • Unitrusts are also of special value to those who are anticipating a major change in your financial status, perhaps an upcoming retirement.
  • Unitrusts are endlessly flexible, and might be the perfect vehicle for your unique investment needs.

4. FLIP UNITRUST

What is a flip unitrust?
The flip unitrust is a variation of the unitrust. The difference is that, at first, you receive only a very small variable return, usually 1 or 2 %, until a specified date. You choose the date – say your 75th birthday. At that time, the unitrust “flips” to a higher yearly percentage, established in the original agreement. During the years before your birthday, the principal is invested, with maximum growth as the goal. When you turn 75, the principal will have grown substantially because of this investment strategy.

What are the details?

The same as for a unitrust.

Is a flip unitrust right for you?
The flip trust is good for those who don’t currently need extra income, but will want a comfortable lifetime income after a specific date or event; you retirement, or a special birthday. Another use is to accumulate income for a second beneficiary like a child or grandchild. Flip trusts are particular useful for those who foresee a major change in their financial status for which they want to prepare for it.

CHARITABLE LEAD TRUST

What is a lead trust?

A charitable lead trust is a trust created for a set number of years. The difference from other charitable trusts is that Hadassah receives the annual income for the length of the trust. At the end of that trust period, the principal remaining in the trust goes to whomever you specified in the trust.

What are the details?

  • The minimum investment is $250,000
  • The minimum term of the trust is 10 years.

Is a lead trust right for you?

If your heirs can wait at least 10 years for their inheritance, then a lead trust with Hadassah may be just what you need.

How could a charitable trust benefit you specifically? Call us today to find out! Our telephone number is 1-800-428-8884 and it’s a toll-free call!"

The information, content and calculations contained herein are intended for educational purposes only and are not intended to provide legal, tax or other professional advice to be relied upon. We encourage you to consult with an attorney, tax advisor or accountant. Figures cited in examples are for hypothetical purpose only and are subject to change. References to estate and income taxes include federal taxes only. State income/estate taxes or state law may impact your results.

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