Building a Legacy.
Do you have…
Helps you to accomplish three significant goals:
Enhanced Charitable Trust is a charitable lead annuity trust (CLAT) that guarantees a charitable gift through purchase of a life insurance policy
Your family receives
A portion of the Enhanced Charitable Trusts assets
are used to purchase an income-producing asset
to provide an annual payout to charity
For maximum leverage, the majority of the trust’s
assets are used to purchase a single premium
life insurance policy
Life insurance inside an Enhanced Charitable Trust
offers multiple advantages
* A universal life insurance policy with a secondary guarantee feature will remain in force provided that sufficient premium is paid.
Donor receives up-frontcharitable deductionand makes a taxable gift
Gift to trust
ENHANCED CHARITABLE TRUST
Trust purchasesincome-producing asset
Trust purchaseslife insurance
Annual income to Charity
Upon Donor’s death…
Non-charitable trustbeneficiaries receive remaining trust assets
Trust makes final payment to Charity
Margaret, female business executive, age 67
Her grandson is suffering from leukemia
She receives a $675,000 charitable deduction; $75,000 taxable gift
Margaret gifts $750,000 to trust
ENHANCED CHARITABLE TRUST
$650,000Trust purchases $1,948,000 single-pay life insurance policy*
$100,000Trust purchasesmunicipal bonds
$4,000 annual income to the St. Jude Children’s Research Hospital
Upon Margaret’s death…
Trust makes a finalpayment of $1,340,000 to St. Jude Children’s Research Hospital
Her children receive $708,000 from death benefit and municipal bonds
* TransACE® policy based on a 67-year old female preferred non-smoker
No guesswork—remainder is guaranteed through life insurance
TransACE® is a nonparticipating, flexible-premium universal life insurance policy issued by Transamerica Life Insurance Company, Cedar Rapids, IA 52499. Policy Form #1-12611107 (CVAT), Group Certificate #2-72336107 (CVAT) for certificates issued under a group policy issued to the Rhode Island National Consumer Protection Trust. Policy form and number may vary, and this policy may not be available in all jurisdictions.
Transamerica Life Insurance Company (“Transamerica”) and its representatives do not give tax or legal advice. This presentation is provided for informational purposes only and should not be construed as tax or legal advice. Clients and other interested parties urged to consult with and rely solely upon their own independent advisors regarding their particular situation and the concepts presented here.
Discussions of the various planning strategies and issues are based on our understanding of the applicable federal income, gift, and estate tax laws in effect at the time of this presentation. However, tax laws are subject to interpretation and change, and there is no guarantee that the relevant tax authorities will accept Transamerica’s interpretations. Additionally, this material does not consider the impact of applicable state laws upon clients and prospects.
Although care is taken in preparing this material and presenting it accurately, Transamerica disclaims any express or implied warranty as to the accuracy of any material contained herein and any liability with respect to it. This information is current as of June 2010.