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TABLE OF CONTENTS
Benefits of a Charitable Remainder Trust . . . . . . . . . . . . . . . . . . . . . .3
American
Institute for
Cancer
Research
Major Gifts, Trusts and Bequests
For the American Institute for Cancer Research
The American Institute for Cancer Research is devoted to the task of conquering our
nation’s most dreaded illness. Each year, the Institute sponsors important research projects
at universities and research facilities across America, focusing on the cause and prevention
of cancer. It has long been a leader in providing effective educational programs on the pre-
vention of cancer – directed to both health care professionals and the general public.
The primary focus of the American Institute for Cancer Research – in both its research
projects and its educational programs – has been the role of diet and nutrition in the devel-
opment and prevention of cancer. (There is scientific evidence that estimates an average of
35% of all cancer deaths might be linked to diet and nutrition.)
We are winning the war against cancer. But there is still a great need for additional sci-
entific research on the cause, prevention and treatment of cancer. As we learn more about
the role of nutrition in the cause and prevention of cancer, our educational programs
become more and more important and rewarding.
Millions of Americans provide financial support to our programs – often through tax-
planned gifts, trusts and bequests. To encourage, facilitate and recognize this very impor-
tant financial support, the Institute has created the League of Willful Cancer Fighters. We
will be pleased to enroll in the League any client who has made or intends to make a
bequest to the Institute or name the Institute as the beneficiary of a trust, life insurance pol-
icy, retirement death benefit or other form of estate gift. We invite you or your client to call
us at your convenience.
We have prepared this booklet to help attorneys and other financial advisers understand
all the important tax and financial rewards Congress has provided. Our staff can provide
the exact tax and financial consequences of any gift, trust or bequest your clients may want
to consider. Because we are so active in this specialized field, we can provide whatever
technical and practical information you may request for planning and drafting a charitable
gift arrangement that will provide your clients both the greatest personal satisfaction and
the greatest tax and financial rewards.
Please feel free to call the Gift Planning Office at any time. Our toll-free telephone
number is 1-800-843-8114. If the opportunity presents itself, please inform your clients
about how a gift, trust or bequest to the American Institute for Cancer Research can help
in the fight against cancer, while also enhancing their personal tax, investment, retirement
and estate plans.
Copyright © 2006 by the American Institute for Cancer Research, 1759 R Street, N.W., Washington, DC 20009
PLANNING AND DRAFTING CHARITABLE
GIFTS AND TRUSTS WITH REAL PROPERTY
Real property – whether residential, investment, Benefit Six: The donor will have the immense
agricultural or commercial and whether improved or personal satisfaction of knowing that his or her gift
unimproved – can often be given to a charitable to the Institute will bring us all closer to the day
remainder trust with very favorable tax and financial when cancer is no longer such a terrible threat to
consequences. our society. Gifts made by generous and concerned
friends of the American Institute for Cancer
Benefit One: No matter how much the property Research in recent years have permitted the Institute
may have appreciated in value, the donor will com- to complete an important study showing Americans
pletely avoid capital gains taxes. Of course, this may how they can reduce their risk of cancer by 30% to
be even more important where the land includes 40%.
buildings that have been subject to depreciation.
Depreciation deductions reduce the owner’s basis Depending on the specific facts, there may be
and will produce capital gain upon sale that is taxed other benefits that can be gained by transferring real
at a 25% rate – all avoidable with a CRT.
property to the Institute or to a trust for the benefit
of the Institute. These special benefits will be
Benefit Two: The present value of the remainder expressed later in this booklet.
interest given to the American Institute for Cancer
Research will qualify for an immediate income tax We need to add that there may also be challenges
charitable deduction. In most cases, the deduction in transferring real property to a charitable remain-
will be based on the fair market value of the proper- der trust. For example, a client may sometimes find
ty transferred to the trust, even though the apprecia- that it is difficult and costly to establish the fair
tion in the value of the property has never been taxed
market value of the property for tax purposes.
to the donor.
Potential environmental liability may have to be
addressed before the charitable remainder trust can
Benefit Three: The donor will also avoid paying accept a gift of real property. The existence of a
sales commissions, which may be as much as 10% mortgage can cause the disqualification of the trust.
of the selling price. There also may be questions concerning the basic
marketability of the property. Indeed, the trustee
Benefit Four: Federal estate and gift taxes are may be unwilling to accept a gift of real property
significantly minimized when the property is trans- until a title search has been made or the donor
ferred to a charitable remainder trust. acquires title insurance.
14
(a) The power to continue to hold any property (d) The power to lease Trust property to others
transferred to the Trust in the form in which it and to lease non-Trust property for the benefit
was at the time of transfer; of the Trust;
(b) The power to sell, exchange or otherwise dis- (e) The power to purchase and carry, at the
pose of any property transferred to the Trust or expense of the Trust, all forms of insurance
acquired by the Trust, and to invest and reinvest reasonably necessary to protect the assets of
in any property, real, personal or otherwise, the Trust;
including corporate equity securities, corporate
debt securities, mutual fund shares, national (f) The power to accept secured or unsecured
and local government securities, limited part- notes in full or partial payment of assets sold
nerships, real estate investment trusts, zero by the Trust;
coupon bonds, life insurance contracts, annuity (g) The power to determine what shall fairly and
contracts or listed options that the Trustees may equitably be charged to principal and what to
in their absolute discretion deem advisable, income;
without regard to any limitation imposed by
law on the investment of Trust funds; (h) The power to make any distributions required
by this agreement in cash or in kind; and
(c) The power to employ and compensate from
Trust funds any attorney, investment advisor, (i) The power to perform all other acts necessary
accountant, tax specialist or other agent deemed or appropriate for the proper and effective
necessary in the administration of the Trust; administration of the Trust.
The War Against Cancer
When you have the occasion to draft a trust or a bequest for a client who wants part of his or her estate to
support the war against cancer, our correct legal name is:
“The American Institute for Cancer Research, a not-for-profit corporation located in Washington, D.C.”
Please feel free to contact our Gift Planning Office for additional information about the mission and the
future plans of the American Institute for Cancer Research.
Our Gift Planning Office will be pleased to help you plan a trust or bequest that will accomplish the spe-
cific objectives of your client. We can also provide the exact tax consequences of any trust arrangement a
client may want to consider. There is no cost or other obligation for this service.
The information and examples provided in this booklet are for information and discussion purposes only.
The examples are hypothetical, and the facts and tax consequences of individual transactions may vary
from person to person. Each estate planning professional must independently determine and evaluate
the tax and financial consequences of each individual situation.