Charitable Lead Trust
Advancement for Middlebury Today and Tax Savings for You Tomorrow
A Charitable Lead Trust provides a way to pass assets to your children at a future time while reducing your federal transfer tax liability, based on a gift you make to Middlebury today.
A lead trust pays income to Middlebury (the "lead income") during the term of the trust. When the trust term ends, the assets in the trust go to your named beneficiaries. If the trust assets have increased in value while they were held in the trust, this increased value is passed on to your heirs without incurring additional federal gift or estate tax.
If you establish a lead trust during your lifetime, you receive a gift tax deduction for the value of Middlebury's interest in the trust. Gift tax is then due only on the present value of the remainder that eventually goes to your family. In some cases, no gift tax is payable. If you establish a lead trust through your will, you can reduce your federal estate tax obligation.
A donor-appointed trustee manages the trust, and Middlebury can act as trustee. Lead trusts provide the most benefit to the donor and Middlebury if they are funded with assets of $1 million or more.
You can establish a Charitable Lead Trust:
- With assets that have high appreciation potential
- Through your Will
- Lead trusts provide the most benefit if they are funded with $1 million or more
Your benefits:
- Removes a portion of your estate from tax liability
- If the assets are to pass to your heirs, any growth in the principal after the trust was inaugurated is exempt from estate tax.
- The amount subject to tax is reduced by the value of our income interest.
Learn More
Contact Anne McMenamin or Deb Wales, our gift planning professionals, for ideas tailored to your situation. There is no fee or obligation for this service.
For more information, you may also complete our request form, call us toll-free at 866.496.6433, or send us an e-mail.
We look forward to hearing from you soon!
