A donor creates a Charitable Lead Trust by
transferring ownership of an asset to a trust. The trust gives the income, or
a percentage of the income, to the Community Foundation each year for a period
of years (usually 15-20). At the end of that period the trust assets are given
back to the donor or to named beneficiaries. The lead trust typically is used
with assets with a potential for continued high appreciation. The trust permits
the assets to be transferred to other family members at a low transfer tax cost.
Utilizing
the Lead Trust, the donor may leave a significantly larger inheritance to his
or her heirs than he or she could have left with a Will or other trusts.
