Charitable Lead Trusts

A Charitable Lead Trust (CLT) is an irrevocable trust designed to provide some financial support to one or more charities for a period of time with the 

remaining assets eventually going to family members or other beneficiaries. CLT’s are often considered to be the inverse of a charitable remainder trust. A CLT can be funded during the lifetime of the individual or by ones will. It is a strategy most frequently used by the charitably inclined for estate or gift tax planning purposes.

How does a Charitable Lead Trust (CLT) work? 

charitable lead trust diagram

The grantor or the person establishing the charitable lead trust makes a contribution to fund the trust which is set up to operate for a fixed number of years or the life of one or more people. Payments from the trust are dispersed to the selected charity as either a fixed annuity payment or a percentage of the trust. At the end of the term the remaining assets are distributed to non-charitable beneficiaries, often family members.

Charitable giving maybe complicated. You may wish to contact legal or tax advisers.

Contact:  cheryl clark

Cheryl A. Clark, CFP

Office: 712-325-5920

Cell: 712-890-7155

cclark@childrenssquare.org

5-01-2020