CRT Calculator: Estimate Your Charitable Remainder Trust Benefits
This calculator estimates the benefits of a Charitable Remainder Unitrust (CRUT). When you fund a CRUT with appreciated assets:
- No capital gains tax on asset sale
- You receive income for life or duration
- Charity receives remaining value after trust ends
Key Takeaways
Tax savings are significant - Avoiding capital gains tax means more money works for you and your charity.
Income is predictable - With a CRUT, you receive a steady income stream that can grow with investments.
Estate planning benefits - Assets in the trust don't count toward your taxable estate, potentially reducing estate taxes.
Setting up a charitable remainder trust isn’t just a way to give back-it’s a smart financial move that lets you support causes you care about while keeping income for yourself or your loved ones. Many people think charitable giving means handing over money and walking away. But a charitable remainder trust flips that script. You keep income. You get tax breaks. And your favorite charity still wins big in the end.
How a Charitable Remainder Trust Works
A charitable remainder trust (CRT) is a legal arrangement where you transfer assets-like cash, stocks, or real estate-into a trust. The trust pays you (or someone you name) an income for life or a set number of years. After that, whatever’s left goes to the charity you chose. It’s not a donation upfront. It’s a delayed gift with benefits built in.
Let’s say you own $500,000 in appreciated stocks. Instead of selling them and paying capital gains tax, you put them into a CRT. The trust sells the stocks tax-free and reinvests the money. You get 5% of the trust’s value each year-that’s $25,000 a year, paid monthly or quarterly. After 20 years, or when you pass away, the remaining balance-maybe $400,000 or more-goes to your chosen nonprofit.
Biggest Benefit: Avoid Capital Gains Tax
If you sell appreciated assets yourself, the IRS takes a cut. For example, if you bought stocks for $100,000 and they’re now worth $500,000, you’d owe capital gains tax on $400,000. At a 20% federal rate, that’s $80,000-plus state taxes if you live in a state that charges them.
But with a CRT, the trust sells the asset without paying any capital gains tax. That means the full $500,000 gets reinvested. That’s $80,000 more working for you and your charity. That’s not a small difference. It’s the difference between a modest income stream and a solid, growing one.
Immediate Tax Deduction You Can Use Right Away
When you fund a CRT, you get an immediate income tax deduction. The amount isn’t the full value of what you put in. It’s calculated based on the charity’s expected future share, your age, interest rates, and how long the trust will pay you. But it’s real.
In 2025, a 65-year-old who puts $500,000 into a CRT might qualify for a deduction of around $200,000 to $250,000. That could knock $50,000 to $70,000 off your federal tax bill over a few years, depending on your tax bracket. You don’t have to use it all at once-you can carry forward unused portions for up to five years.
Protect Your Income for Life
Unlike a direct donation, a CRT doesn’t leave you broke. You get paid. You can choose how much and how often. Two types of CRTs exist:
- Charitable Remainder Annuity Trust (CRAT): Pays a fixed dollar amount each year. Good if you need predictability.
- Charitable Remainder Unitrust (CRUT): Pays a fixed percentage of the trust’s value each year. If the trust grows, your income grows too.
Most people pick the CRUT. Why? Because it keeps pace with inflation. If your trust investments do well, your payments go up. If the market dips, they go down-but they never drop below zero. And you can add more money to a CRUT later, which you can’t do with a CRAT.
Reduce Estate Taxes for Your Heirs
If you’re worried about your estate being hit with taxes when you die, a CRT helps here too. Assets in a CRT are removed from your taxable estate. That means less for the IRS to take.
Let’s say your estate is worth $2 million. Without planning, estate taxes could take 40% off the top for amounts over the exemption limit (which is around $13.6 million per person in 2026). Even if you’re not near that threshold now, your estate could grow. By moving $500,000 into a CRT, you reduce your taxable estate by that amount-and you still get income from it.
Your heirs still get something. You can name them as beneficiaries of other assets, or use the tax savings from the CRT to buy life insurance that replaces the value you gave away. That’s called an irrevocable life insurance trust (ILIT), and it’s a common partner to CRTs.
Support the Causes You Care About-Without Sacrificing Your Lifestyle
You don’t have to choose between helping others and taking care of yourself. A CRT lets you do both. Maybe you’ve spent years volunteering at the local food bank. Or your parent was treated at a hospital you want to honor. You can give back in a way that lasts.
And unlike writing a check, a CRT makes your gift grow. The trust invests your assets. Over time, that money compounds. That means your charity gets more than you put in. A $300,000 gift today might turn into $600,000-or more-over 20 years. That’s real impact.
Who Should Consider a CRT?
Not everyone needs one. But if you fit this profile, it’s worth exploring:
- You own highly appreciated assets (stocks, real estate, business interests)
- You’re over 55 and want to boost your retirement income
- You’re charitably inclined but don’t want to give up cash flow
- You’re concerned about estate taxes
- You want to simplify your estate plan
If you’re younger, have limited assets, or don’t plan to leave much behind, a CRT probably isn’t for you. But if you’re sitting on assets that have grown over decades, and you want to make your giving count-this is one of the most powerful tools available.
What You Need to Know Before Starting
A CRT isn’t a DIY project. You need:
- A trustee (usually a bank, trust company, or professional advisor)
- A lawyer to draft the trust document
- An accountant to handle the tax reporting
Costs vary. Setting up a CRT can cost between $3,000 and $10,000, depending on complexity. But those costs are often offset by tax savings in the first year alone.
Also, once you set it up, it’s permanent. You can’t change your mind and take the assets back. That’s why it’s critical to choose your charity wisely. Pick one you trust, one that will be around for decades.
Real Example: A Retired Teacher in Wellington
Susan, 68, retired from teaching in 2020. She owns a small apartment building she bought in 1995 for $180,000. Today, it’s worth $850,000. Selling it would mean paying over $130,000 in capital gains tax. She didn’t want to sell. But she also didn’t want to manage it anymore.
She set up a CRUT with $800,000 of the property’s value. The trust sold the building tax-free. She gets 6% of the trust’s value each year-about $48,000. She got a $320,000 tax deduction, which cut her federal taxes by $80,000 over three years. In 20 years, the remaining $700,000 will go to a local youth literacy program she volunteers with.
She still has income. She still supports the cause. And her heirs don’t inherit a tax nightmare.
Final Thought: It’s Not Just Giving. It’s Smart Planning.
A charitable remainder trust isn’t for everyone. But for those who have assets that have grown significantly, it’s one of the most elegant solutions to three problems at once: how to give generously, how to keep income, and how to reduce taxes. It turns a simple act of charity into a lasting legacy.
If you’re thinking about giving more than you can afford to give now, a CRT might be the missing piece. Talk to a financial advisor who’s worked with these before-not just any planner. Look for someone who understands trusts, tax law, and nonprofit giving. Ask them to show you a projection. See how the numbers work for your situation. Then decide.
Can I change the charity after setting up a charitable remainder trust?
No. Once you fund the trust, the charity is locked in. That’s why choosing the right one is critical. If you’re unsure, pick a well-established nonprofit with a long track record, like a hospital, university, or national charity with local chapters. You can’t switch later, so make sure it’s a cause you believe in for the long haul.
What happens if the trust runs out of money before I die?
If the trust is a CRUT and its value drops below zero due to poor investments, your payments stop-but you don’t owe money. The trust is designed to pay only what’s available. With a CRAT, payments stay fixed, even if the trust runs out. That’s why it’s important to invest wisely and diversify assets. Most trustees use conservative, income-focused portfolios to protect against this.
Can I fund a CRT with real estate?
Yes. Real estate is a common asset used to fund CRTs. But it’s trickier than cash or stocks. The trust must sell the property first, which can take time. And if it’s rental property, the trust must handle tenants, maintenance, and taxes until it sells. Some trustees charge extra for managing real estate. Make sure your trustee has experience with this type of asset.
Is a CRT better than a donor-advised fund?
It depends. A donor-advised fund (DAF) gives you an immediate tax deduction and lets you recommend grants over time. But you don’t get income from it. A CRT gives you annual payments. If you need income now, CRT wins. If you want flexibility and lower setup costs, a DAF might be better. Many people use both: a DAF for smaller gifts and a CRT for larger, appreciated assets.
Do I need to be rich to set up a CRT?
Not necessarily, but you need enough to make it worthwhile. Most advisors recommend a minimum of $250,000 to $500,000 in assets to justify the setup costs and complexity. If you have less, a simpler option like a bequest in your will or a DAF may be better. But if you have a valuable asset-like a home, business, or stock portfolio-that’s grown over decades, even $200,000 can make sense.
