The Power of Planned Giving

A charitable lead trust creates a win-win opportunity for both the donor and the University of Maryland

Making a planned gift to the University of Maryland Medical Center is a noble act that conveys a strong commitment to the future of our institution and most importantly, our patients. A legacy gift, such as a charitable lead trust, can also provide substantial benefits to the donor.

Through a charitable lead trust, a donor designates a specific amount of assets that are given to the University of Maryland for an established period of time — typically over the remainder of the donor’s lifetime. When the period ends or the donor passes away, the remaining funds in the trust are returned to whomever the donor assigned as the beneficiary. This type of trust allows the donor to give to the University of Maryland in the present, while ensuring that their loved ones are financially cared for in the future.

A charitable lead trust offers appealing tax incentives as well. By donating to the University of Maryland through a charitable lead trust, you can avoid paying gift or estate tax. Once the payments to the University of Maryland end, the assets left over in the trust are transferred to the beneficiaries, typically at a much lower tax rate.

Charitable Lead Trust

Income Payment Basis

Fixed or variable payments to University of Maryland.

Taxation of Income

Annual income is tax free to the extent it is paid to University of Maryland. Donor or trust may be taxable under certain circumstances.

Income Tax Deduction for Gift

Donor enjoys gift or estate tax deduction, but will generally not receive an income tax deduction.

Final Disposition of Funds

Returned to donor or transferred to heirs as provided in trust agreement.

Funds Returnable to Donor

In most cases, principal is transferred to donor’s heirs at end of trust term. Donor may have property returned if trust is structured accordingly.

Basis for Finding Deductible Value of Gift

Estate or gift tax deduction for value of the charitable interest.

Advantages to Donor

1. Possible estate and gift tax savings.

2. Income tax deductions may be possible for value of payments made to University of Maryland.

3. Assets eventually returned to donor or loved ones.

Value to Charitable Interest

Recipient of payments from the trust; may in some cases be beneficiary at death.

To learn more about your gift planning opportunities, please complete and submit this form. Or you may call 410.328.5770 or email umms-foundation@umm.edu.