The Asset-transferring Family Foundation

The Asset-Transferring Family Foundation, also known as a non-grantor charitable lead trust, is a gift plan that allows you to transfer assets to family members at reduced tax cost while making a generous gift to charitable causes.

How the Asset-Transferring Family Foundation Works at the Family Legacy Fund
You transfer assets, usually cash, securities or property, to a trustee of your choice. Depending on whether a unitrust or annuity trust is created, during the trust’s term, the trustee invests the assets and provides a fixed dollar amount or a fixed percentage of the net value of the assets each year to your donor-advised fund at Family Legacy Fund. These payments are used for the charitable purposes designated by you and continue until the trust term ends. The trust’s term may be for a specific number of years, one or more lifetimes or a combination of the two. The payments are made out of trust income, or trust principal if the trust income is not adequate. If the trust income during a given year exceeds the annual charitable payment, the trust pays income tax on the excess. When the Asset-Transferring Family Foundation term ends, the trust distributes all of its accumulated assets to family members or other beneficiaries named by you.

Benefits of this Arrangement

• You will qualify for a substantial federal gift tax deduction. This discounts for gift tax purposes the value of the assets that will eventually be passing to your heirs.
• Your donor-advised fund at Family Legacy Fund can receive annual payments from the trust for a term of years, enabling you to support the charitable causes you care about.
• Your family or other beneficiaries will receive all of the trust’s assets when the trust terminates. Any asset growth that occurs within the trust will be distributed to the trust’s beneficiaries free of gift or estate taxes.