charitable (adjective, char-i-ta-ble, \ ˈtʃærətəbəl \) lead (noun, lead, \ liːd \) trust (noun, trust, \ trʌst \)
Definition: is a trust type that serves the purpose of reducing the taxable income of the beneficiaries by firstly granting a share of the trust’s funds to various charity organizations, and later, once a predetermined period of time has passed, transferring the rest to the appropriate beneficiaries. This mechanism is oftentimes used to decrease taxes that fall onto an estate left by a deceased individual until it can be handed over to the beneficiaries that will need to pay lower taxes.
In a Sentence:
- I think establishing a charitable lead trust is a great idea. First, we’ll spend some money on community causes and give back to the society, and afterward, we’ll be able to pay much lower taxes.
- We’ve contacted an agency to find out how we can create our own charitable lead trust. It turns out, the process of establishing such a trust won’t be as straightforward as we thought it to be.
Synonyms and related words: charitable remainder trust, trust, trust company, charitable organization
