Charitable Remainder Trusts and Preparing Form 5227 (Currently Unavailable)

Author: Steven G. Siegel

Understand How CRTs Work and Preparing Form 5227, The Split-Interest Trust Return

With the political risk of increasing income tax rates on the wealthiest taxpayers, client interest is growing in using charitable remainder trusts as a planning device not only to benefit charity, but to also reduce income and transfer taxes, especially when a taxpayer has appreciated property. Important rules involving income, gift and estate taxation may need to be addressed. When such a trust is created, it becomes necessary to prepare and file Form 5227, Split-Interest Trust Return to report the income and distributions of the trust, as well as to advise the IRS of the trust's ongoing performance.

This timely and helpful two-hour CPE course, presented by noted estates and trusts practitioner, author and educator Steven G. Siegel, J.D., LL.M, will arm you with knowledge and seasoned guidance to help you understand how charitable remainder trusts work and how to manage the compliance requirements in reporting to the IRS with Form 5227.

Join Mr. Siegel as he offers helpful tips and practical suggestions to give you and your staff a strong understanding of how to advise clients in this important area.

Publication Date: March 2021

Designed For
This course is essential for CPAs, CFPs, enrolled agents, estate planners, tax attorneys and other professionals who advise clients on tax, retirement and estate planning, and other wealth management matters.

Topics Covered

• Charitable Remainder Trusts: General Description and Requirements
• Charitable Remainder Unitrusts
• Income Tax Deduction
• Income Taxes to Donor/Grantor
• Planning Opportunities
• Investment Issues with a CRT
• Required Distribution Issues
• Self”Dealing Rules Apply
• Page 1 — Identification Information
• Page 2 — Schedule of Distributable Income; Description of Distributions of Principal and Income
• Page 3 — Balance Sheet
• Page 4 — Charitable Remainder Annuity Trust Information
• Page 5 — Activities for which Form 4720 (Excise Taxes) May be Required
• Page 6 — Questionnaire for Charitable Lead Trusts, Pooled Income Funds, and Charitable Remainder Trusts
• Page 7 — Schedule A, Distributions of Income to and Taxation of Beneficiaries

Learning Objectives

• Describe what Charitable Remainder Trusts are and how they are used
• Recognize how to explain the tax-exempt nature of CRTs
• Identify how to properly complete Form 5227, Split-Interest Trust Return
• Describe what is not included in the four-tier system for determining the income tax character of the distributions made from a CRT
• Recognize which items would be included in Part 1, Section C, of Form 5227
• Identify an allowable deduction on Form 5227

Level
Intermediate

Instructional Method
Self-Study

NASBA Field of Study
Taxes (2 hours)

Program Prerequisites
Basic knowledge of wealth transfer taxation concepts.

Advance Preparation
None