Charitable Giving to ASP

Ways to give to the Armenian Studies Program at California State University, Fresno while retaining lifetime rights. (Continued from the March, 2004 issue of Hye Sharzhoom.)

 Charitable Remainder Trust.  A Unitrust is also a separate trust, established and managed in the same manner as an Annuity Trust.  The distributions to the life income beneficiary, however, are variable.  At the time the Unitrust is established, the donor designates a “unitrust percentage” and a “valuation date” to be used to calculate the distribution for each calendar year.  For example, a 5% unitrust percentage and a January 1 valuation date would result in a revaluation of trust assets as of each January 1, with the life income beneficiary to receive 5% of that value as distributions for that year.  With a successful investment policy, an increasing value of trust assets will result in an increasing income to the life income beneficiary.

Unitrusts may be either in the form of a “standard” percentage arrangement or in the form of a  “net income” arrangement.  With a “standard” percentage, the payment is made first out of ordinary income (dividends, interest, rents) and then out of capital gains.  With a “net income” arrangement, the lesser of the unitrust percentage or ordinary income for the calendar year is paid out.

Remainder Interest in Residence.  A gift of a remainder interest in a personal residence (primary residence, second home, vacation home) will allow the donor to continue to live in the residence for life, with title then vesting automatically in the University upon death.  All of the tax benefits described above are available, but no separate trust or other payment arrangement is introduced.  The donor continues to live in the residence (and remains responsible for property taxes, insurance, upkeep, etc.).