Charitable Lead Trust

Protect Your Assets

You can benefit from the tax savings that result from supporting UWL Foundation Inc. without giving up the assets that you'd like your family to receive someday with a donation in the form of a charitable lead trust.

There are two ways that charitable lead trusts make payments to UWL Foundation:

A charitable lead annuity trust pays a fixed amount each year to UWL Foundation and is more attractive when interest rates are low.

A charitable lead unitrust pays a variable amount each year based on the value of the assets in the trust. With a unitrust, if the trust's assets go up in value, for example, the payments to UWL Foundation go up as well.

Read our free guide about this gift

Watch our video explaining this gift

An Example of How It Works

Father smiling with childrenGeorge would like to support UWL Foundation and provide for his children. Following his advisor's recommendation, George funds a charitable lead annuity trust with assets valued at $2,500,000.

George's trust pays $175,000 (7 percent of the initial fair market value) to UWL Foundation each year for 15 years, which will total $2,625,000. After that, the balance in the trust goes to his children. Assuming a 6 percent investment return, the children will receive approximately $1,918,101.

His gift tax deduction is $2,182,775* against the $2,500,000 of assets. Therefore, only the difference ($317,225) is subject to gift tax, which is offset against his lifetime gift tax exclusion. After that, the remaining trust assets and all of their growth will pass to his family at zero additional cost in gift and estate taxes. Had George given the $2,500,000 outright to his children, it would have been a taxable gift.

*Assuming annual payments and a 2.4 percent charitable midterm federal rate.

Gifts That Pay

Your payments depend on your age at the time of the donation. If you are younger than 60, we recommend that you learn more about your options and download this FREE guide Plan for Retirement With a Deferred Gift Annuity.