Charitable Remainder Trust (CRT) Calculator

Model your income stream, estimated charitable deduction, and capital gains tax avoided — versus paying tax and reinvesting today. Covers both CRUT (variable income, % of trust value) and CRAT (fixed annual dollar amount) structures.

CRUT vs. CRAT: which structure fits your situation?

• CRUT (Charitable Remainder Unitrust) pays a fixed percentage of the trust's value, revalued each year. Income rises in strong markets and falls when markets drop. Additional contributions are allowed after funding. Best for: donors who want inflation participation, or who may contribute more assets later.
• CRAT (Charitable Remainder Annuity Trust) pays a fixed dollar amount set at inception. Completely predictable income regardless of markets. No new contributions allowed. If the trust earns less than the payout rate, it eventually depletes — leaving nothing for charity. Best for: donors who need certainty over their income amount and are confident in the return assumption.
• Most charitable planning advisors recommend CRUT for most situations because it adapts to portfolio performance.

How a CRT actually works

• You contribute an appreciated asset — stock, real estate, business interest — to an irrevocable trust. Once contributed, you cannot take the asset back.
• The trust sells the asset tax-free inside the trust. The capital gain is not recognized on sale. Instead, it is distributed to you over time as income (under the four-tier ordering rules: ordinary income first, then capital gain, then return of basis).
• The trust reinvests the full proceeds and pays you income for the term or for life.
• At the end of the term, the remaining balance passes to your named charity — or to a Donor-Advised Fund, giving you flexibility to direct grants later.
• You receive a charitable income tax deduction today for the present value of what the charity will ultimately receive.

IRS rules the CRT must satisfy

• 10% minimum remainder test (IRC § 664): The present value of the charitable remainder must be at least 10% of the initial contribution. If the payout rate is too high, the term too long, or (for CRAT) the §7520 rate too low, the trust fails and is disqualified. This calculator flags failures.
• Payout rate: Must be between 5% and 50%. Most well-designed CRTs use 5–7% to preserve a meaningful charitable remainder.
• Term: Maximum 20 years for a term-certain trust. Life trusts use IRS actuarial tables to set the term based on life expectancy; those can run beyond 20 years.
• Four-tier taxation: CRT income is taxed to beneficiaries in priority order — ordinary income first, capital gain second, tax-exempt income third, return of corpus last. Large appreciated positions often produce mostly capital gain income to you for several years before shifting to ordinary.

Worked example: $2M of appreciated stock

You hold $2M in a single stock position with a $200K cost basis. Selling outright: $1.8M gain × 23.8% federal = $428K in capital gains tax, leaving $1.57M to reinvest. Alternatively, contribute to a 6% CRUT over 20 years. The trust sells tax-free, reinvests the full $2M, and pays approximately $120K in year 1. You receive an estimated $580K charitable deduction today (subject to 30% AGI limit). The trust's larger starting base compounds through the entire term — the deferred capital gains stay working longer.