A charitable remainder unitrust ("unitrust") is a gift plan defined by federal tax law that allows you to provide income to yourself or others while making a generous gift to MidAmerica Nazarene University. The income may continue for the lifetimes of the beneficiaries you name, a fixed term of not more than 20 years, or a combination of the two.
As a unitrust donor, you irrevocably transfer assets, usually cash, securities, or real estate, to a trustee of your choice (for example, MidAmerica Nazarene University or a bank trust department).
During the unitrust's term, the trustee invests the unitrust's assets. Each year, the trustee distributes a fixed percentage of the unitrust's current value, as revalued annually, to your income beneficiaries. If the unitrust's value goes up from one year to the next, its payout increases proportionately. Likewise, if the unitrust's value goes down, the amount it distributes also goes down. For this reason, it may be to your advantage to choose a relatively low payout percentage so that the unitrust assets can grow, which in turn will allow the unitrust's yearly payments to grow.
Payments must be between 5% and 50% of the trust's annual value and are made out of trust income, or trust principal if income is not adequate. Payments may be made annually, semiannually, or quarterly.
When the unitrust term ends, the unitrust's principal passes to MidAmerica Nazarene University, to be used for the purpose you designate. You may add funds to your unitrust whenever you like.
To receive a proposal based on actuarial calculations contact Tim Keeton at 913-971-3607 or firstname.lastname@example.org.
September 6, 2005
This information is for educational purposes only and should not be considered legal, accounting, or other professional advice. If legal advice or other expert assistance is required, the services of a competent professional person should be sought.