A CRT retains an income stream for the donor while ultimately benefiting charity — distinct from a donor advised fund, which gives up all control immediately.
How it works
A CRUT’s payout is a fixed percentage recalculated each year against current trust value — rising if the trust grows, falling if it shrinks. A CRAT instead fixes the dollar payment at funding, never adjusting regardless of investment performance.
What this does not include
This computes the annual payout only — the charitable income tax deduction requires a full present-value calculation of the eventual charitable remainder, factoring in the specific §7520 rate and trust term, which this calculator doesn’t compute.
How to use this calculator
- Enter the current trust value and payout rate.
- Select CRUT or CRAT.
Frequently asked questions
What’s the minimum payout rate the IRS allows?
5% annually — a CRT must pay out at least that much each year to qualify for its favorable tax treatment.
Which is better, a CRUT or a CRAT?
Depends on the goal — a CRUT’s variable payout can grow with the trust (helpful against inflation) but also shrink; a CRAT’s fixed payout offers predictability regardless of investment performance.
What happens to the trust assets at the end of the term?
Whatever remains passes to the named charity — the entire structure exists to eventually benefit that charitable remainder, which is what earns the upfront partial income tax deduction.
