Multi-Generational Philanthropy
Charitable Lead Trust (CLT)
The reverse of a CRT. Fund the causes you care about now with annual trust payments, then transfer the remaining assets to your heirs at dramatically reduced gift and estate tax rates. Philanthropy and family wealth, together.
Understanding the Basics
What Is a CLT?
A Charitable Lead Trust (CLT) is an irrevocable trust that makes annual payments to one or more charities for a specified term. When the term ends, the remaining trust assets pass to your non-charitable beneficiaries (typically children or grandchildren) at a reduced gift or estate tax value.
The CLT is the mirror image of a Charitable Remainder Trust. Where a CRT pays income to the family first and gives the remainder to charity, a CLT pays charity first and gives the remainder to the family. The gift or estate tax value of the remainder going to family is reduced by the present value of the charitable payments, potentially resulting in a zero or near-zero taxable transfer.
Like GRATs, CLTs are especially powerful when assets outperform the IRS Section 7520 rate. If trust investments grow faster than the hurdle rate, the excess passes to family members free of gift and estate tax. This makes CLTs particularly attractive during periods of low interest rates and for high-growth assets.
Is It Right for You?
Who Is a CLT For?
Multi-Generational Philanthropists
Families with a tradition of charitable giving can use a CLT to support their favorite causes while passing substantial wealth to the next generation at reduced or eliminated transfer tax rates.
Wealthy Families Seeking Transfer Tax Reduction
A well-designed CLT can transfer millions to heirs with zero gift or estate tax by structuring the charitable payments to offset the full value of the transferred assets for tax purposes.
Families With Young Heirs
If your children or grandchildren are too young to manage an inheritance, a CLT acts as a built-in delay. Charity receives payments during the term while the remainder grows for your heirs, who receive it when they are older and better prepared.
What You Get
Key Features
Transfer Tax Reduction
The taxable gift is reduced by the present value of the charitable lead payments, potentially resulting in a tax-free transfer to your heirs.
Meaningful Charitable Impact
Your chosen charities receive guaranteed annual payments for the entire trust term, providing them with predictable funding for their missions.
Growth Passes to Family
If trust assets outperform the 7520 hurdle rate, all excess growth passes to your family beneficiaries completely free of transfer taxes.
Grantor or Non-Grantor Options
A grantor CLT provides you with an income tax deduction. A non-grantor CLT maximizes the estate and gift tax benefits. Our AI recommends the optimal structure.
The Process
How It Works
Design & Optimization
Our AI models payout rates, term lengths, and trust types to minimize transfer taxes while maximizing both charitable impact and the remainder for your family.
Fund the Trust
Transfer assets into the CLT. The gift tax value of the transfer to your heirs is reduced by the present value of the charitable lead payments.
Charitable Payments
The trust makes annual payments to your designated charities for the specified term while the remaining assets continue to grow.
Remainder to Family
At the end of the charitable term, all remaining trust assets, including any growth above the hurdle rate, pass to your family beneficiaries.
Philanthropy + Wealth Transfer
Support Charity Now. Transfer Wealth Later.
A CLT is the ultimate expression of values-based wealth transfer. Fund the causes you believe in while building a financial legacy for your family.
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Common Questions
Frequently Asked Questions
Build a Legacy of Giving and Wealth
A CLT supports the causes you love while passing wealth to the people you love, at a fraction of the tax cost. Let us design the optimal structure.