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Charitable Lead Trust

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Protect Your Assets

You can benefit from the tax savings that result from supporting The Conservancy of Southwest Florida without giving up the assets that you'd like your family to receive someday with a donation in the form of a charitable lead trust.

There are two ways that charitable lead trusts make payments to the Conservancy:

A charitable lead annuity trust pays a fixed amount each year to the Conservancy and is more attractive when interest rates are low.

A charitable lead unitrust pays a variable amount each year based on the value of the assets in the trust. With a unitrust, if the trust's assets go up in value, for example, the payments to the Conservancy go up as well.

An Example of How It Works

Man smilingGeorge would like to support the Conservancy and provide for his children. If he follows his advisor's recommendation, George would fund a charitable lead annuity trust with assets valued at $2,500,000.

George's trust would pay $175,000 (7 percent of the initial fair market value) to the Conservancy each year for 15 years, which would total $2,625,000. After that, the balance in the trust would go to his children. Assuming a 6 percent investment return, the children would receive approximately $1,918,101.

His gift tax deduction would be $2,317,400* against the $2,500,000 of assets. Therefore, only the difference ($182,600) would be subject to gift tax, which would be offset against his lifetime gift tax exclusion. After that, the remaining trust assets and all of their growth would pass to his family at zero additional cost in gift and estate taxes. If George would give the $2,500,000 outright to his children, it would be a taxable gift.

*Assuming annual payments and a 3.2 percent charitable midterm federal rate.

Discover More

See which type of charitable trust best fits your estate plan with the FREE guide Choose From 2 Win-Win Ways to Donate.

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Action Steps

  1. Contact Aaron Lapp at 239-403-4222 or AaronL@conservancy.org to talk about supporting the Conservancy by setting up a charitable lead trust.
  2. Seek the advice of your financial or legal advisor.
  3. If you include the Conservancy in your plans, please use our legal name and federal tax ID.

Legal Name: Conservancy of Southwest Florida
Location: 1495 Smith Preserve Way, Naples, Florida 34102
Federal Tax ID Number: 59-1157084

A charitable bequest is one or two sentences in your will or living trust that leave to The Conservancy of Southwest Florida a specific item, an amount of money, a gift contingent upon certain events or a percentage of your estate.

an individual or organization designated to receive benefits or funds under a will or other contract, such as an insurance policy, trust or retirement plan

"I give to The Conservancy of Southwest Florida, a nonprofit corporation currently located at 1495 Smith Preserve Way, Naples, Florida 34102, or its successor thereto, ______________ [written amount or percentage of the estate or description of property] for its unrestricted use and purpose."

able to be changed or cancelled

A revocable living trust is set up during your lifetime and can be revoked at any time before death. They allow assets held in the trust to pass directly to beneficiaries without probate court proceedings and can also reduce federal estate taxes.

cannot be changed or cancelled

tax on gifts generally paid by the person making the gift rather than the recipient

the original value of an asset, such as stock, before its appreciation or depreciation

the growth in value of an asset like stock or real estate since the original purchase

the price a willing buyer and willing seller can agree on

The person receiving the gift annuity payments.

the part of an estate left after debts, taxes and specific bequests have been paid

a written and properly witnessed legal change to a will

the person named in a will to manage the estate, collect the property, pay any debt, and distribute property according to the will

A donor advised fund is an account that you set up but which is managed by a nonprofit organization. You contribute to the account, which grows tax-free. You can recommend how much (and how often) you want to distribute money from that fund to the Conservancy or other charities. You cannot direct the gifts.

An endowed gift can create a new endowment or add to an existing endowment. The principal of the endowment is invested and a portion of the principal’s earnings are used each year to support our mission.

Tax on the growth in value of an asset—such as real estate or stock—since its original purchase.

Securities, real estate or any other property having a fair market value greater than its original purchase price.

Real estate can be a personal residence, vacation home, timeshare property, farm, commercial property or undeveloped land.

A charitable remainder trust provides you or other named individuals income each year for life or a period not exceeding 20 years from assets you give to the trust you create.

You give assets to a trust that pays our organization set payments for a number of years, which you choose. The longer the length of time, the better the potential tax savings to you. When the term is up, the remaining trust assets go to you, your family or other beneficiaries you select. This is an excellent way to transfer property to family members at a minimal cost.

You fund this type of trust with cash or appreciated assets—and may qualify for a federal income tax charitable deduction when you itemize. You can also make additional gifts; each one also qualifies for a tax deduction. The trust pays you, each year, a variable amount based on a fixed percentage of the fair market value of the trust assets. When the trust terminates, the remaining principal goes to the Conservancy as a lump sum.

You fund this trust with cash or appreciated assets—and may qualify for a federal income tax charitable deduction when you itemize. Each year the trust pays you or another named individual the same dollar amount you choose at the start. When the trust terminates, the remaining principal goes to the Conservancy as a lump sum.

A beneficiary designation clearly identifies how specific assets will be distributed after your death.

A charitable gift annuity involves a simple contract between you and the Conservancy where you agree to make a gift to the Conservancy and we, in return, agree to pay you (and someone else, if you choose) a fixed amount each year for the rest of your life.
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