Receive income for life with a gift

Planned gifts to the community through the Rochester Area Foundation are received at a time that the donor designates or plans – thus the phrase “planned gifts.” Examples of planned gifts are “life income” gifts.

Charitable Remainder Annuity and Charitable Remainder Unitrusts Trusts are two types of life income gifts. These trusts allow you to make a gift to the community during your lifetime and still retain the income from the gift.

In both the Unitrust and the Annuity Trust, a trust fund is established that ultimately will be used to benefit the community in ways that meet your charitable objectives. However, in exchange for your gift, you and/or your designated beneficiaries will receive for life an income based on the value of the trust fund. The major difference between the Charitable Remainder Annuity Trust and the Unitrust is the method used to determine income payments.

The Annuity Trust pays a fixed dollar amount annually that is established when the trust is created. The Unitrust pays a fixed percentage of the trust assets, which are valued annually.

Different, yet similar

Except for the difference in payment method, both the Annuity Trust and the Unitrust have similar characteristics:

• An annual income is paid to you or one or more beneficiaries you name during their lives.
• You receive an immediate federal income tax deduction in the year the trust is established.
• If you use appreciated securities or other property to fund the trust, you may avoid capital gain tax on the appreciation.
• The trust pays no tax on future capital gain.