Reversionary Charitable Lead Annuity Trust
Design, Drafting & Consulting Services
Who We Serve
We work with
3 types of clients:
Those in need of IMMEDIATE tax savings from their future annual gifts to charity
Financial advisors, accountants, & attorneys; a
Charities, churches, ministries & donor advised fund (DAF) sponsors.
We are engaged to design, draft, establish and fund iCLATs, that's our sole purpose! iCLATs are technically known as "reversionary" charitable lead annuity trusts. We provide our services in all 50 states. Our services are provided collaboratively with our clients' professional advisors (attorneys, accountants and financial planners).
What We Do
GENERATE IMMEDIATE INCOME TAX SAVINGS
from Future Annual Charitable Gifts
(# of Years)
% of Year 1 Charitable Deduction
(Based on the iCLAT's TOTAL Annual Payments to Charity)
Example: A 20-year iCLAT with annual payments to charity of $25,000/year (TOTAL of $500,000 to charity) will generate a $451,138 IMMEDIATE Year 1 charitable deduction for the client/donor!
Example: A 15-year iCLAT with annual payments to charity of $25,000/year (TOTAL of $375,000 to charity) will generate a $346,626 IMMEDIATE Year 1 charitable deduction for the client/donor!
Example: A 10-year iCLAT with annual payments to charity of $25,000/year (TOTAL of $250,000 to charity) will generate a $236,782 IMMEDIATE Year 1 charitable deduction for the client/donor!
Example: A 5-Year iCLAT with annual payments to charity of $25,000/year (TOTAL of $125,000 to charity) will generate a $121,335 IMMEDIATE Year 1 charitable deduction for the client/donor!
Example: A 3-Year iCLAT with annual payments to charity of $25,000/year (TOTAL of $75,000 to charity) will generate a $73,524 IMMEDIATE Year 1 charitable deduction for the client/donor!
An "iCLAT" is simply a trust that makes annual distributions to charity for a specified term of years and then, at the end of the term, distributes the remaining trust assets back to its grantor (i.e. the donor or the client). For legal and IRS purposes, an iCLAT is known as a "reversionary" charitable lead annuity trust, which is treated as a "grantor trust" for federal income tax purposes. Importantly, an iCLAT has nothing to do with saving estate taxes, or estate planning for that matter. Think of an iCLAT as an "Income Tax Savings CLAT"
HOW does an iCLAT generate so much IMMEDIATE TAX SAVINGS?
An iCLAT will work best for someone who regularly gives at least $10,000 per year to one or more charities (including their place of worship)
(1) has a spike income event of $250,000 or more;
(2) has a high current level of income that is expected to end within the next two years from retirement, or other reasons.
The IMMEDIATE YEAR 1 charitable tax deduction generated by an iCLAT is equal to the "present value" of it's annual payments to charity - using the IRS §7520 interest rate, which is released each month. Since the IRS §7520 interest rate remains at all-time historic low levels (1.0% for October 2021), the resulting year 1 charitable tax deductions from iCLATs are extremely large! Use the iCLAT Calculator Tool to instantly determine the IMMEDIATE charitable tax deduction and tax savings that a particular iCLAT can generate for you, your clients, or your donors.
4 KEY REASONS
The IRS 7520 interest rate remains at historically low levels (the rate is only 1.0% for October 2021). The extremely low discount rates are what allow iCLATs to generate such large IMMEDIATE charitable income tax deductions (and resulting tax savings) in the current year.
As a result of the recent DOUBLING OF THE STANDARD DEDUCTION, 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 realistic possibility of increased income tax rates and changes to the charitable deduction in the near future.
The prior overall limitation on itemized deductions for high-income individuals, the so-called "Pease Limitation," is currently suspended (until December 31, 2025). As a result, an iCLAT's large immediate charitable deduction will produce significantly more income tax savings now in comparison to prior years.
WHO can most benefit from an iCLAT?
WHY is 2021 is one of the best years to create an iCLAT?
FREE CUSTOMIZED iCLAT ILLUSTRATION
It only takes a few minutes to answer the few questions necessary in order for our team to create a FREE iCLAT Illustration specifically customized to your particular situation. If you prefer, your information may be provided on a completely anonymous basis. You will receive your customized iCLAT Illustration within 2 business days after we receive your answers.
SCHEDULE A PERSONAL CALL OR ZOOM MEETING
Schedule a FREE NO OBLIGATION 30 MINUTE PERSONAL CALL OR ZOOM MEETING with our Founder & President - Brad Gornto. You are welcome to invite any of your professional advisors to join your Call or Zoom Meeting as well!
SIGN UP FOR ONE OF OUR
Our Founder & President - Brad Gornto provides FREE webinars throughout the year for individual givers, charitable giving/development professionals and also for allied professional advisors (accountants, attorneys and wealth advisory teams).
GOT A QUESTION? SEND IT TO US.
If you have a question, please send it to us. We'll get back to you promptly with an answer, usually within 24 hours. Also, be sure to look at our Frequently Asked Questions (FAQs) page. Your question may have already been asked by others - and answered.
Where do iCLATs Generate
Additional Tax Savings at the State Income Tax Level?
BEST - Top Tier State Income Tax AND 100% Charitable Deduction
*The highest income tax rate in these States range from 7% to 13%.
GOOD - 2nd Tier State Income Tax AND 100% Charitable Deduction
*The highest income tax rate in these States range from 2% to 6.9%.
NEUTRAL - States with NO Income Tax Rates OR NO State Charitable Deduction
* iCLATs will only save Federal Income Taxes in these States