Setting up a charitable remainder trust lets you help a charity that you want to support while also helping yourself during this life. It also lets you pave the way for a legacy upon your death. Many of the personal benefits of a charitable remainder trust relate to taxes.

You set up such a trust by creating the trust and transferring the property you want to give to charity into the trust. You make the charity the trustee, and it manages the trust and pays you some portion of income earned off the property you transferred. For example, if you have shares in stock and you transfer it into the trust, then the charity might later sell that stock and pay you a portion of the profits.

A charitable remainder trust can only be set up for a charity that meets Internal Revenue Service requirements, which typically means that the charity is tax-exempt. Because of this, the charity would not have to pay taxes on the profit from the sale of stock — or any other income-generating action involved in the trust. If you sold the stock outright and made a profit, you would owe capital gains tax.

Any property that remains in the trust upon your death transfers to the charity without being included in calculations for estate valuation. Depending on how much your estate value is, that difference could keep you under the threshold for estate taxes, saving your heirs a great deal of money.

Finally, you can take a certain portion of the value of your charitable donation and use it as a tax deduction over five years. To better understand if a charitable remainder trust is the right option for you, consider speaking with an estate lawyer.

Source: FindLaw, “Tax Incentives for a Charitable Remainder Trust,” accessed Sep. 16, 2016