Case Study 

The following is an illustration of how this type of donation works.

Susan, 60, wants to make a gift to a qualified charitable organization but would also like more income in the future.


Gift: Susan creates a charitable remainder unitrust with annual lifetime payouts to her equal to 6 percent of the fair market value of the trust assets. She funds the trust with $250,000 in stock, which she originally bought for $85,000. The stock paid her annual dividends of $5,000.

Benefits to giver: Susan receives $15,000 the first year from the trust, tripling her previous income. Subsequent payout amounts vary each year depending on the annual valuations of the trust assets. She is eligible for a federal income tax charitable deduction of $81,3051 in the year she creates and funds the trust. This deduction saves Susan $22,765 in her 28 percent tax bracket.

Note: If Susan had sold the stock and not given it to the trust, she would not have received the charitable deduction, and she would have paid an additional $24,750 in capital gains tax.

Benefits to the organization: At the end of the trust term (in this case, after Susan's lifetime), the organization is projected to receive more than $300,000 to continue our charitable work, based on 7 percent growth of the trust's assets.

Question MarkAre you worried about future inflation?
A charitable remainder unitrust can provide you with payments that can potentially increase over time if the trust assets increase in value.

Learn How You Can Help
To discuss the good your trust could accomplish at Willamette University, please contact Steve Brier at (866) 204-8102 or sbrier@willamette.edu.

1Based on annual payments and a 2.4 percent charitable midterm federal rate. Deductions vary based on income earned.