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What is a charitable lead trust?
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A charitable lead trust (CLT) is essentially a charitable remainder trust in reverse. First, the charity receives an income stream (the income interest), then, at the end of the specified trust term, which can be for a term of years, for the lifetime of the donor, or for the lifetimes of the donor and the donor’s spouse, any income and principal remaining in the CLT (the remainder interest) can either revert back to the donor or pass to other non-charitable beneficiaries named in the trust.
For more information on charitable lead trust’s and other charitable deductions, you can go to http://kenhimmler.com.
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How does a charitable lead trust work?
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A CLT can be funded in two ways:
- Inter Vivos – An inter vivos CLT is funded during the grantor’s life.
- Testamentary – A testamentary CLT is funded at the donor’s death through the donor’s will. As long as the CLT is included in the donor’s taxable estate, the estate can deduct the net present value of the income stream granted to the charity. Minimizing estate taxes is the primary motive for funding a CLT at death.
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What is a charitable remainder trust?
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A charitable remainder trust (CRT) is an irrevocable trust used to enable donors (called grantors) to give money or property to charities, while continuing to receive income (fixed or variable) from the property for life or for a period of time up to 20 years. The grantor, and/or other beneficiaries (the income beneficiaries) receive distributions from the trust annually, and the charities (the remainder beneficiaries) receive the assets remaining in the trust when the trust ends. The grantor gets an immediate income tax deduction for the remainder interest (subject to the usual limitations), defers or avoids capital gains Read more…
Thanks to my son TJ the wonderful photographer at age 11
Well besides the sweltering heat of 93 degrees we had a great time on the boat today. We had two great speakers, Cristine Olson from T.I.F.F. and Bruce Riley from Identity Shield. Christine shared her heartfelt story about her daughter and her life mission to make sure no other family has to go through the same ordeal. Thank you very much for sharing with us and creating To Inform Families First I hope everyone takes advantage of this and goes online to put in your information. We would really like your comments on the value of this to you. We also heard from Bruce Riley from Identity Shield. I personally think he had a great presentation and informed all of us on the fastest growing crime “Identity Theft”. We will be hearing more from Bruce on this subject in the near future. Lastly, I spoke about the dreary economic outlook and told everyone about the upcoming webinar on Recession Splitting Strategies. We will be holding this on Thursday July 31, 2008 at 6:30 PM. There is only space for 100 attendees so if you want your spot let us know because it will be on a first come-first serve basis. The formal invitations will be going out next week but if you want to reserve a spot send an email to ken@iamllc.biz and we will put your name on the list. The way it will work is that you can either call in to hear the teleconference or you can log in to watch the video presentation along with the teleconference. Again it was great seeing all of you on the boat and enjoy the pictures and videos in following posts. Ken
PS We have been told by our email service that a lot of the emails for the invitation to the boat were kicked back. In order to make sure you are getting our emails you have to add our email addresses to your white list or your approved email list. Since we typically send from different addresses to ensure delivery please add *@iamllc.biz and *@kenhimmler.com The * is the shift 8 key. This should help to make sure you are getting our emails. Lastly, if you want to get this blog to be automatically sent to our email click on the link in the top left corner and you will begin to get these posts.
In recent months we have seen the real estate market drop like a rock. Let’s face it for those people that didn’t see it coming they either had their head in the sand or had some distant relative that got caught in the 1849 gold rush fever and it is in their DNA. In some parts of the country property values have dropped 50% to 60%. Our local governments had a fun time increasing services, pay raises, increased benefits and hiring like there was no tomorrow. Now that property values Read more…
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Summary:
A buy-sell agreement is a legally binding contract in which the owners of a business set forth the terms and conditions of a future sale or buy back of a departing owner’s share of the business. Specifically, buy-sells control when owners can sell their interests, who can buy an owner’s interest, and at what price.
Buy-sells can accomplish many objectives, but are primarily used to ensure the smooth continuation of a business after a potentially disruptive event, such as an owner’s retirement, incapacity, or death.
Also valuable estate planning tools, buy-sells can provide for the orderly succession of a family business, and for the liquidity needed for payment of a deceased owner’s estate settlement costs and taxes. Further, if structured properly, a buy-sell can establish the purchase price as the taxable value of an owner’s business interest, avoiding unexpected estate tax consequences at the owner’s death. |
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What is a buy-sell agreement?
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Buy-sell agreements are very important planning tools that can accomplish many things for a business with two or more owners. Sometimes referred to as a prenuptial or premarital agreement among business owners, a business continuation agreement, a stock purchase agreement, or a buyout agreement, a buy-sell is a legally binding contract that establishes when, to whom, and at what price an owner, partner, or shareholder can sell his or her interest in a business.
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