Richard is a successful business owner. His younger brother, Robert, was born with special needs. For the past 10 years, Richard has supported Robert, including paying the costs for Robert's adult care facility. Richard recently learned about a special needs trust that would enable him to continue to provide Robert with the care he needs.
Richard: I just turned 75 and Robert is fifteen years younger than I am. Robert would be unable to meet his monthly expenses without my help. I love my brother and recently started thinking about what would happen to Robert if something were to happen to me.
Richard and his attorney discussed a charitable remainder unitrust and special needs trust as a way to achieve Richard's goals. The unitrust would pay income to the special needs trust to support and care for Robert during his lifetime. Any remaining value in the unitrust would go to support the Evangelical Free Church of America.
Richard: I liked what the attorney had to say about the special needs trust. My primary concern, of course, was taking care of Robert but my attorney told me that this trust arrangement would produce some nice tax benefits too. I decided to fund the trust with some appreciated stock. I was able to avoid capital gains tax on the sale of the stock and reduced my income taxes because I received a charitable deduction.