Charitable Lead Trust (CLT)
Income to charity now, with the remainder returning to you or your heirs.
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Overview & Purpose
The mirror of a charitable remainder trust: a charitable lead trust pays an income stream to charity for a period, after which the remaining assets pass to non-charitable beneficiaries such as family members.
Who May Consider It
- You want to support charities now while ultimately preserving wealth for your family.
- You are planning in a high-interest-rate environment where CLT tax benefits may be favorable.
- May reduce the taxable value of the gift to remainder beneficiaries, depending on structure and applicable rates.
- Provides a stream of payments to chosen charities during the trust term.
- Does NOT guarantee tax savings — outcomes depend on the §7520 rate and trust structure.
Important Trade-offs
- Irrevocable; remainder beneficiaries do not receive assets until the term ends.
Relevant Assets
State charitable trust oversight rules may apply.
Questions to Discuss with an Attorney
- Should this be a grantor or non-grantor CLT, and what term fits my goals?
Related Documents
Sources & References
This article was prepared using publicly available legal and government sources. Laws change, and readers should verify current rules in their jurisdiction.
Reviewed for educational accuracy
Last reviewed: September 30, 2026 · Next scheduled review: March 2027
This article is educational information and is not legal advice. Laws vary by jurisdiction. No attorney has reviewed this material unless a named, licensed attorney is credited above.
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