Gifts That Pay You Income

The Advantages of a Charitable Remainder Trust

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If you are looking for a way to support Bates and receive retirement income with the potential for growth based on the market, consider a charitable remainder trust.

These types of gifts do offer you tax benefits and the option for income. There are two ways to receive payments and each has its own benefits:

The unitrust pays you, each year, a variable amount based on a fixed percentage of the fair market value of the trust assets. The amount of your payments is redetermined annually. If the value of the trust increases, so do your payments. If the value decreases, however, so will your payments.

The annuity trust pays you, each year, the same dollar amount you choose at the start. Your payments stay the same, regardless of fluctuations in trust investments.

How It Works

Woman happy Susan, 60, wants to make a gift to Bates but would also like more income in the future. Susan creates a charitable remainder unitrust with annual lifetime payments to her equal to 5 percent of the fair market value of the trust assets as revalued annually. She funds the trust with assets valued at $250,000.

Susan receives $12,500 the first year from the trust. Subsequent payment amounts vary each year depending on the annual valuations of the trust assets. She is eligible for a federal income tax charitable deduction of $95,355* in the year she creates and funds the trust. This deduction saves Susan $26,699 in her 28 percent tax bracket.

*Based on annual payments and a 2.4 percent charitable midterm federal rate. Deductions vary based on income earned.

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Next Steps

  1. Contact the Office of Gift Planning at (207) 786-6246 or Toll-free: (800) 762-3145 or giftplanning@bates.edu to talk about supporting Bates by setting up a charitable remainder trust.
  2. Seek the advice of your financial or legal advisor.
  3. If you include Bates in your plans, please use our legal name and federal tax ID.

Legal Name: President and Trustees of Bates College
Address: 2 Andrews Road, Lewiston, ME 04240
Federal Tax ID Number: #01-0211781