CURRENT Income Tax SAVINGS
for Future Annual Charitable Gifts
Whiteboard Explainer Video
to quickly understand
the iCLAT and when it
works best !
FIND OUT if an iCLAT is Right for You
What is an iCLAT?
An "iCLAT" is a specific type of trust that makes ongoing annual charitable distributions for a set term of years, and then at the end of the term distributes the remaining trust assets back the person who created the iCLAT (i.e. the "grantor"). In technical terms, an iCLAT is known as a “reversionary" charitable lead annuity trust that is designed to be a grantor trust for federal income tax purposes. It is the "reversionary" aspect of the iCLAT which makes it unique from a traditional charitable lead trust ("CLT"). Unlike traditional CLTs, the sole purpose of an iCLAT is to save income taxes, not estate taxes. As a result, an iCLAT is much easier to explain, establish and administer in comparison to traditional CLTs. LEARN MORE
How does an iCLAT work?
How does the iCLAT work? How does it generate such a large current year charitable income tax deduction? Two words . . . "present value." The person who establishes an iCLAT (a/k/a the grantor) is entitled to a current year charitable income tax that is equal to the "present value" of the annual payments to charity over the specified term of years for the iCLAT. By way of example, an iCLAT established in October 2019 that distributes $20,000 to charity for a period of 10 years will generate a current 2019 charitable income tax deduction of $179,243! This accelerated charitable deduction is almost 90% of the total $200,000 distributed to charity over the 10-year term of this iCLAT. LEARN MORE
Who can most benefit from an iCLAT?
An iCLAT will work best, by generating the greatest amount of "accelerated" income tax savings, for those persons who:
currently give between $10,000 and $100,000 per year to one or more charitable organizations (including their church or other place of worship), or plan to start doing so in the current year on a consistent basis; AND, EITHER:
have a "ordinary income" event of $250,000 or more in the current year; OR
- have high current income but plan to retire (or their income will otherwise end) within the next three years. LEARN MORE
Why is 2019 the ideal year to consider an iCLAT?
THERE ARE 4 KEY REASONS FOR WHY
2019 IS THE IDEAL YEAR TO CONSIDER AN iCLAT:
As a result of the DOUBLING OF THE STANDARD DEDUCTION, which went into effect on Jan 1, 2018, it is now harder than ever to receive any income tax savings from charitable gifts under $12,500/yr. for single persons and $25,000/yr. married persons.
The IRS 7520 interest rate remains at historically low levels (1.8 % is the October 2019 rate), which allows all CLTs to generate a very large "accelerated" charitable income tax deduction in the current year.
The overall limitation on itemized deduction for high-income individuals, the so-called "Pease Limitation", was suspended on January 1, 2018. As a result, an iCLAT's large accelerated charitable deduction will produce greater income tax savings now compared to 2017 and prior years.
The uncertainty concerning the future of the charitable income tax deduction. LEARN MORE
Meet Our President & Founder
BRAD GORNTO, JD, LLM
Brad Gornto has practiced law in Florida for 19 years in the areas of complex estate planning, business law, probate and trust administration, charitable planning and tax law. In addition to his law practice, Brad is also the President and Founder of Effectual Giving, LLC, which is a consulting firm that assists charitable organizations and philanthropic families across the country in the actual implementation of all forms of effective planned giving solutions, including the iCLAT.
Brad's unique dual expertise as a practicing estate planning attorney and a planned giving consultant why he is a sought-after expert by charities, philanthropic families, financial planners, accountants, family offices and even other attorneys.
Email Brad directly at:
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