The CCHS Foundation Legacy Society
Smart Ways to Give
Charitable Lead Trusts
You can benefit from the tax savings that result from supporting Central Catholic High School Foundation without giving up the assets that you'd like your family to receive someday with a donation in the form of a charitable lead trust.
There are two ways that charitable lead trusts make payments to Central Catholic High School Foundation:
A charitable lead annuity trust pays a fixed amount each year to Central Catholic High School Foundation and is more attractive when interest rates are low.
A charitable lead unitrust pays a variable amount each year based on the value of the assets in the trust. With a unitrust, if the trust's assets go up in value, for example, the payments to Central Catholic High School Foundation go up as well.
An Example of How It Works
Nicholas would like to support Central Catholic High School Foundation and receive tax benefits. Nicholas received a windfall amount of income and needs a large income tax deduction to offset the income. Following his advisor’s recommendation, Nicholas funds a grantor charitable lead annuity trust with assets valued at $1,000,000.
Nicholas’ trust pays $60,000 (6% of the initial fair market value) to Central Catholic High School Foundation each year for 15 years, which will total $900,000. After that, the balance in the trust reverts back to Nicholas. He receives an income tax charitable deduction of $614,445. Assuming the trust earns an average 8% annual rate of return, Nicholas receives approximately $1,600,286 at the end of the trust term.
Nicholas’ trust pays $60,000 (6% of the initial fair market value) to Central Catholic High School Foundation each year for 15 years, which will total $900,000. After that, the balance in the trust reverts back to Nicholas. He receives an income tax charitable deduction of $614,445. Assuming the trust earns an average 8% annual rate of return, Nicholas receives approximately $1,600,286 at the end of the trust term.
*Based on a 5.2% charitable midterm federal rate. Deductions and calculations will vary depending on your personal circumstances.
Next Steps
- Contact Jim Pecchenino, '72 at (209) 968-1120 or pecchenino@cchsca.org to talk about supporting Central Catholic High School Foundation by setting up a charitable lead trust.
- Seek the advice of your financial or legal advisor.
- If you include Central Catholic High School Foundation in your plans, please use our legal name and federal tax ID.
About Central Catholic
Faithful to our Catholic Tradition, our mission is to witness to the Gospel while building an educational community that inspires the spiritual, academic and social development of young adults.
Central Catholic Students Are:
Academically-Prepared
Spiritually-Developed
Socially-Responsible
Globally-Conscious
Central Catholic Students Are:
Academically-Prepared
Spiritually-Developed
Socially-Responsible
Globally-Conscious
