Overview Booklet Calculator

Sale and Unitrust

Are your appreciated assets, like stocks, bonds, or real estate, generating little or no income? Selling these assets could result in a significant capital gains tax. A sale combined with a charitable remainder unitrust may offer a way to avoid this tax while supporting your charitable goals.

Benefits of a sale and unitrust

Receive cash from the sale, which you can use for various purposes, such as purchasing a new home, saving for retirement, traveling, covering daily expenses, or achieving other financial goals
Potentially receive a charitable income tax deduction for the present value of the charity's future interest in the trust, reducing your taxable income
Further the work of Planned Parenthood of the Pacific Southwest with your gift

How a sale and unitrust works

You establish a charitable remainder unitrust and transfer a portion of your assets to the trust.
The assets are then sold by the trustee. You receive cash from the sale and the rest of the sale's proceeds are paid to the charitable remainder unitrust.
The trust will provide you with income for the rest of your life. As the trust assets are managed and grow, the income you receive may increase over time.
You may receive a charitable income tax deduction for the present value of the charity's future interest in the trust, reducing your taxable income.
By removing the assets placed in the charitable remainder unitrust from your estate, you may reduce the size of your estate, potentially lowering your estate tax liability for your heirs.
A sale and unitrust arrangement allows you to contribute to a charitable organization of your choice, leaving a lasting legacy while benefiting from the financial advantages during your lifetime.

More on sale and unitrust

When transferring a portion of your primary residence to fund a unitrust, you may be able to apply your one-time home exclusion to reduce or eliminate the capital gains tax that would normally apply to the sale. However, you must not continue living in the residence if you plan to use this gift structure. It's advisable to consult with your tax advisor to determine if this strategy is right for you.

Sale and unitrust video

Contact us

If you have any questions about a sale and unitrust, please contact us.

Booklet

Download Booklet

Calculate Benefits

The sale and unitrust calculator generates a printable presentation that shows how you can receive cash plus increased income from trust. Charitable tax deduction reduces tax on gain.

* Required fields

Help content opened below

Number of Beneficiaries

One Two

Click the appropriate button for a presentation of one or two beneficiaries. Selecting one beneficiary will cause the second beneficiary and the associated name and birthdate fields to be hidden from view.

First Beneficiary

Enter the name of the person. You may use such titles as "Mr.", "Mrs.", "Dr.", "Rev.", "Jr.", "Sr.", etc. For the remainder unitrust the first person is the first income recipient or beneficiary of the agreement.

First beneficiary is required

Birthdate

Month:

Day:

Year:

Please enter a valid birthdate for the first beneficiary

Birth month of the first beneficiary is required

Birth day of the first beneficiary is required

Birth year of the first beneficiary is required

Second Beneficiary

Second beneficiary is required

Birthdate

Month:

Day:

Year:

Please enter a valid birthdate for the second beneficiary

Birth month of the second beneficiary is required

Birth day of the second beneficiary is required

Birth year of the second beneficiary is required

Income Tax Rate

Select the current federal income tax rate of the donor. This will be used to project possible income tax savings. If you are uncertain about the correct rate, you may choose one of the middle rates. For many people, this will be close to their actual income tax rate.

Property Value $

Please enter a valid property value

Property value is required

Enter the amount of cash or the fair market value (FMV) of the asset(s) used to fund the CGA. For assets such as real estate, closely-held stock and other hard to value assets, the FMV is the appraised value of the property on the date of the gift.

Cost Basis $

Please enter a valid cost basis

Cost basis is required

Enter the cost basis of the asset being used to fund the trust or annuity. If the asset is cash, the cost basis is equal to the gift amount. If it is appreciated property, the cost basis will most likely be the amount you originally paid for the property. The cost basis is used to determine the capital gains tax which will be bypassed as a result of selling the asset. If the cost basis is not known or cannot be proven, the IRS assumes the cost basis to be $0. If cash funds the gift annuity, enter the same value as "Value of Property."

Current Return

Current return percentage is required

Enter the current return or yield of the asset(s) which will be used to fund the gift agreement. For example, if the trust will be funded with public-traded stock which is currently paying a dividend of 3%, the current return yield is, in turn, 3%. If the gift is funded with vacant land or a personal residence (assuming the property is not leased), the current return would be 0%.

Trust Payout

Payout must be between 5% and 50%

Payout percentage is required

Enter the percent income payout to the donor. You must select a trust percent payout of 5% or more.

Cash $

Please enter a valid cash amount

Cash amount is required

Enter the amount of cash you wish to receive from the sale of the asset(s) that will be used to fund the trust. This amount of cash will not go into the trust.

Payment Frequency

Select either monthly, quarterly, semiannual, or annual income payments to the beneficiary(ies) of the income. The choice of payment frequency does affect the amount of the charitable deduction as the more frequent the payment (i.e. monthly as opposed to annually), the smaller the donor's tax deduction.

Post-submit calculation error message goes here

Processing