Nongrantor Lead Trust

How It Works

1. Create trust agreement stating terms of the trust (usually for a term of years) and transfer cash or other property to trustee
2. Trustee invests and manages trust assets and makes annual payments to D-E
3. Remainder transferred to your heirs

Benefits

• Annual gift to D-E
• Future gift to heirs at fraction of property's value for transfer-tax purposes
• Professional management of assets during term of trust
• No charitable income-tax deduction, but donor not taxed on annual income of the trust

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