Charitable Remainder Trust

A Charitable Remainder Trust is also known as a CRT, and was created by the Tax Reform Act of 1969. It is an irrevocable trust allowing the donors to convert highly appreciated assets into a lifetime income stream for them, their spouse, or another family member, without generating estate and capital gains taxes. CRTs are most often created for lifetimes but can be for a term of up to 20 years or a combination of the two. The law stipulates the payout must be at least 5% of the value of the underlying trust assets, and the payout is usually in the 5-7% range, depending on the ages of the income recipients. When the trust ends, the remaining assets pass to the University of Idaho to support the programs specified by the donor.