charitable remainder and lead trusts
Establish a Trust to Support Americans for the Arts
If you would like to support Americans for the Arts in an especially significant way, and have the assets available, you may want to consider setting up a trust. We will gladly work with you and your advisors to help establish one according to your wishes. Depending on your situation, it is usually feasible to fund a trust with assets—including cash, securities held for more than one year, and real estate—worth $100,000 or more. Learn more about your trust options:
Charitable Remainder Annuity Trust
When you establish a charitable remainder annuity trust, a fixed sum of money is paid to you and/or one or more other named beneficiaries each year for life or for a specified term of up to 20 years. When the trust ends, its remaining assets pass to Americans for the Arts.
If you want to secure a steady stream of payments or increase cash flow from low-yield holdings, these trusts are a good choice because the amount you receive is fixed, regardless of how the value of the trust changes over time. You can also take an immediate charitable deduction for part of the value contributed to the trust. You may also avoid or delay capital gains taxes on appreciated assets used to fund the trust.
A charitable remainder unitrust combines a gift with an investment component. You place assets in a trust, and then you and/or one or more other named beneficiaries receive lifetime income from the trust. When the trust ends, Americans for the Arts receives what remains of its assets. With a unitrust, the amount you receive as income is a fixed percentage of the annual net fair market value of the trust assets.
This can be a good choice as it provides the opportunity to increase your income as the value of the trust’s assets increases (although income may decrease from one year to the next if the value of the trust’s assets decline). Unitrusts also offer a sizable income tax charitable deduction and may help to avoid or delay capital gains taxes if you contribute appreciated assets
Note: Unitrusts, unlike annuity trusts, also allow additional assets to be placed in the trust over time, thereby affording a measure of flexibility.
It is also possible to establish a charitable lead trust, which is the opposite of a charitable remainder trust: payments are made to Americans for the Arts each year during the trust’s existence, and when the trust terminates, its remaining assets are distributed to one or more individuals. The amount paid may be either fixed (a lead annuity trust) or variable (a lead unitrust).
Tax advantages of lead trusts can include the ability to increase charitable giving, and in some circumstances, to reduce the size of one’s estate, so that in transferring assets to heirs, gift and estate taxes are either reduced or eliminated.
If you would like to notify Americans for the Arts of your bequest intentions through a trust, please fill out our Bequest Notification Form [PDF].
For information about joining our Americans for the Arts Legacy Society for donors, visit our Legacy Society page.
The information provided by Americans for the Arts is not financial, tax, or legal advice. You should consult your advisors before making charitable gift decisions.