What Is a Charitable Remainder Unitrust?

A charitable remainder unitrust is a tool used in estate planning to help a beneficiary and a charitable organization. Here are the basics of a charitable remainder unitrust.

Charitable Remainder Unitrust

A charitable remainder unitrust is a type of irrevocable trust. This means that once you set it up, there is no going back. When you set up this type of trust, you are going to transfer a certain sum of your assets into the trust. At that point, the trust is going to make a regular annuity payment to a beneficiary of your choice. With this system, you can effectively provide for one of your beneficiaries financially for a specific amount of time. After a certain period or when the individual who set up the trust dies, this annuity payment is going to stop. At that point, the money left over in the trust is going to be passed onto a charitable organization. 


By using this tool, you are going to be able to avoid estate taxes because the assets are not yours when you pass away. You will also be able to determine what beneficiary is going to receive payments and what charitable organization will get the rest.

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