A Charitable Lead Trust is often viewed as the opposite of a charitable remainder trust.  A donor transfers property to the trust, which pays either a fixed annuity amount (Charitable Lead Annuity Trust or CLAT) or a fixed percentage of the value of the trust assets (Charitable Lead Unitrust or CLUT) to a named charity or charities, usually for a term of years.  At the end of the trust term, the remaining assets in the trust and any growth it has realized are passed to the named remainder beneficiaries.  

Although there is no income tax deduction when you create a Charitable Lead Trust, the value of the original assets going into the trust benefits from a gift and estate tax deduction because of the income stream given to the charity.  In addition, any growth in the assets of the trust is passed to the remainder beneficiaries free of gift and estate tax.

Our attorneys are experienced with both types of Charitable Lead Trusts and can advise you toward choosing the appropriate trust that best fits your overall estate plan.