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Nongrantor Lead Trust
How It Works
- Create trust agreement outlining terms of the trust—usually for a term of years
- Transfer cash or other property to trustee
- Trustee invests and manages trust assets
- Trustee makes annual payments to
- Remainder transferred to your heirs
Benefits
- Annual gift to
- Future gift to heirs at fraction of property's value
- Professional management of assets during term of trust
- No charitable deduction, but donor not taxed on annual income
Next Steps
Please note: Because the federal estate tax has been repealed for 2010, there is no current estate tax in 2010 for the gifts described on this page. However, the consensus opinion among professionals is that Congress will enact an estate-tax law that may be retroactive to January 1, 2010. It is very important that you seek the advice of your estate-planning attorney to determine what changes, if any, need to be made to your existing estate plans, and then again if Congress reinstates the estate tax sometime later this year.
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