Charitable Remainder Trusts A charitable remainder trust offers your client a great deal of flexibility. Payments may be made to your client or another beneficiary for life or a specified number of years. The income beneficiaries annually receive an amount equal to a fixed percentage of the trust’s fair market value, or a fixed dollar amount. A charitable remainder trust may be set up during your client’s lifetime or through their will. The eventual distribution to Cumberland Community Foundation will only take effect upon the death of the trust’s income beneficiaries, or at the end of the specified number of years. At this time, the remainder of the trust transfers to Cumberland Community Foundation to the endowment your client designed to support favorite causes, forever.
Charitable Lead Trusts: A Charitable Lead Trust enables your clients to make significant charitable gifts now while transferring substantial assets to beneficiaries later. A trust is set up from which Cumberland Community Foundation receives annual payments for life or for a specific number of years. These funds may be used to support nonprofits your clients choose or be added to your client’s Advised Fund. When the trust terminates, the principal is returned to your clients or distributed to others they designate. The trust assets pass to the recipients at reduced tax cost—sometimes even tax-free.
Retained Life Estates: Your clients can turn their property’s value into community good by making a gift of real estate to Cumberland Community Foundation. Your clients can continue to live in and fully enjoy their home (or vacation property) while giving the future ownership of it to Cumberland Community Foundation. This is called a Retained Life Estate. The gift of the “remainder interest” is a charitable contribution in the year the gift arrangement is made, which may result in a substantial income tax charitable deduction. When the life tenancy terminates, Cumberland Community Foundation becomes the owner of the property. The proceeds of the property’s sale may be used to establish a new fund or be added to an existing fund at Cumberland Community Foundation.