Mr. and Mrs. Wheeling, who wish to make a significant gift to the Museum, have a son to whom they would like to transfer a substantial block of stock. He is young and they do not wish to burden him with the management of these assets at this time. They have good reason to expect that the value of the stock will appreciate in the coming years, and would like to remove it from their estates so as to avoid estate tax in the future. Since they do not depend on the income from these assets, they decide that a charitable lead trust may be the way to fulfill both of these objectives.
With this plan, the Wheelings are able to ensure that:
- The Museum can plan for the use of a stream of income for a number of years.
- When the trust terminates, the assets in the trust will pass, with no additional tax, to their son.
- The trust property has been removed from—and therefore is not taxable in—their estate.
This example is for illustration purposes only. The donors are composites and do not represent actual contributors to the Museum. Specific updated examples can be provided on request at no obligation.