Charitable Remainder Trusts
15. Income Tax Deduction
Now, how much will your charitable income tax deduction be?
That will depend on the amount of income you receive, the size and type of asset you gift, and the ages and number of people who receive income from the trust.
Basically, the higher the payout rate, the lower your deduction will be.
In addition, your annual deduction is usually limited to 30% or 50% of your adjusted gross income.*
And, remember, if you cannot use the entire tax deduction in the year you make the gift, you can carry it forward for up to five additional years.
*NOTE: The deduction will vary from 20% to 50% AGI, depending on how the IRS defines the charity and type of asset involved. Generally, the deduction for appreciated property is limited to 30% of AGI and unappreciated property to 50% AGI.