It is possible to fund a Legacy endowment while deriving income from the gift during your lifetime.\u00a0 Through charitable gift annuities and charitable remainder trusts funded with cash or other property, you may provide for an endowed gift at death while also providing lifetime income for you, your spouse, or other family members.<\/p>\n
Especially during times when traditional investments are producing modest or even volatile returns, establishing a charitable gift annuity would enable you to provide for an endowed gift while also allowing you to receive a guaranteed annual income distribution for the remainder of your life (or life of your spouse or other family member). A portion of the principal used to fund the annuity is tax-deductible in the year it is given. The income you receive is based on your age (and the age of any other income beneficiary). In addition, a percentage of the annual income is considered a return of principal and is tax-free.<\/p>\n
If you wish to use appreciated securities or other appreciated property to establish your named endowment, you may wish to consider the advantages of a charitable remainder trust of which there are two types – the unitrust and the annuity trust. With the unitrust, you receive income each year based on a percentage of the value of the principal of the trust (which is fixed when the trust is established), as revalued annually.<\/p>\n
If you want to add to the unitrust at a later time, you may do so without creating additional trust instruments. An annuity trust is much the same as the unitrust, with the exception that the income amount established when the trust is formed does not change.\u00a0 Additional gifts cannot<\/u> be made to the annuity trust.<\/p>\n
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