Charitable Lead Trust

You can benefit from the tax savings that result from supporting Riley Children's Foundation without giving up the assets that you'd like your family to receive someday with a donation in the form of a charitable lead trust.

There are two ways that charitable lead trusts make payments to RCF:

A charitable lead annuity trust pays a fixed amount each year to RCF and is more attractive when interest rates are low.

A charitable lead unitrust pays a variable amount each year based on the value of the assets in the trust. With a unitrust, if the trust's assets go up in value, for example, the payments to RCF go up as well.

An Example of How It Works

Father smiling with childrenGeorge would like to support RCF and provide for his children. George received a windfall amount of income and needs a large income tax deduction to offset the income. Following his advisor's recommendation, George funds a grantor charitable lead annuity trust with assets valued at $1,000,000. George's trust pays $70,000 (7 percent of the initial fair market value) to RCF each year for 15 years, which will total $1,050,000. After that, the balance in the trust reverts back to George. He receives an income tax charitable deduction of $854,311. Assuming the trust earns an average 6 percent annual rate of return, George receives approximately $767,240 at the end of the trust term.

*Assuming annual payments and a 3.2 percent charitable midterm federal rate.

Next Steps

  1. Contact Kate Brinkerhoff at 317-808-8601 or KBrinkerhoff@RileyKids.org to talk about supporting RCF by setting up a charitable lead trust.
  2. Seek the advice of your financial or legal advisor.
  3. If you include RCF in your plans, please use our legal name and federal tax ID.

Legal Name: James Whitcomb Riley Memorial Association, Inc. d/b/a Riley Children's Endowment
Address: 30 South Meridian Street, Suite 200, Indianapolis, IN 46204
Federal Tax ID Number: 35-0868147

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