Carol lived in the family home where she and her husband Frank raised their children. After Frank passed away, Carol found it increasingly difficult to take care of her home.
She read an article in the Allentown Symphony planned giving newsletter that explained how she could make a gift of her home and receive income for life through a charitable remainder trust.
Carol: I called the symphony and asked how a charitable remainder trust works. They told me that when the time came for me to move out of my home, I could give it to the Allentown Symphony Association and set up a special kind of trust. The trust would provide me with income for the rest of my life, and I would receive a tax deduction for my gift.
Carol thought that she might want to move to a condominium with less upkeep. Her financial advisor reviewed the plan and said that the income she received from the charitable remainder trust would be enough to cover her living expenses.
Carol: I found a condominium nearby that was perfect for me. I called the Allentown Symphony and told them I was ready to move out of my home and set up the charitable trust. I was thrilled that I could turn my home into income and receive a charitable deduction for my gift.
Your home has been one of your best assets, but after the kids move out and the house gets harder to care for, you may have other needs. Better than a reverse mortgage, a charitable trust is one strategy to "downsize" your home, avoid capital gains tax, and provide you with income.
To learn more about how a trust could help you downsize, please give us a call. We are happy to answer any questions you might have.