CHARITABLE TRUSTS.

With a charitable remainder trust you make a gift to Village Theatre (and possibly other charities) and receive income for your lifetime (or a period of years that you specify). You may have an asset you wish to donate to the Village Theatre, or you may have an asset that is under performing and you would like to improve your cash flow from it. You may be reluctant to sell the asset and reinvest in something more productive because of substantial capital gains taxes. As an alternative, you might consider a charitable remainder trust that can be established benefiting you and, in the long run, providing support for Village Theatre’s future.

You transfer the assets into a trust and designate a trustee. The trustee manages the assets, which involves selling them and reinvesting the proceeds as appropriate, and pays income to you (or other designated beneficiaries). When the trust sells appreciated assets, it pays no tax on the gains. Payments can be a fixed amount (annuity trust) providing you the security of the same payment each time; or payments can be based on a stipulated percentage of trust assets (unitrust), meaning payments will vary but have the possibility of increasing over time. When the trust terminates, the remaining principal is used to benefit Village Theatre. The CRT has additional benefits: