Give It Twice Trust - Help Family and Charity

A Testamentary Charitable Remainder Unitrust (A Give it Twice Trust) Might Be a Smart Alternative to Naming your Heirs as Beneficiary of your Traditional IRA

If you named your children or other heirs as the beneficiaries of your IRA years ago, now may be a good time to review that decision with your financial advisor. Due to changes in the law, your heirs might owe more in taxes than you expected. For most IRAs inherited after January 1, 2020, most non-spouse beneficiaries must withdraw all the money from an inherited IRA within 10 years, which could come with a large tax burden.

What You Can Do: A Charitable Trust Might Be a Smart Move

One option is to use a Testamentary Charitable Remainder Unitrust (T-CRUT)—sometimes called a "Give It Twice Trust."

Here's how it works:

Give it Twice Trust

IRA

Unitrust

UWSBC

Children

• When you pass away, your IRA goes into the trust.
• The trust makes annual payments to your children or other heirs, helping spread out the income and taxes over time.
• After those payments are complete (often 10-20 years), whatever remains in the trust goes to a charity you care about, like United Way.

This strategy may help reduce taxes for your heirs, provide income for them over time, and supports a cause that's meaningful to you.

Benefits of a give it twice trust

• Keep control of your funds throughout your lifetime
• Leave a lasting legacy to United Way of Santa Barbara County
• Allows you use the full value of your unused retirement account to provide income for your heirs for a specified period of years, which, in the case of most adult children, can be longer than if they were IRA beneficiaries
• Potentially spread out the taxes on the inheritance of adult children
• The give it twice trust establishes a mechanism that will help you treat each of your children equally. This can help promote peace in your family.
• The give it twice trust gives children income rather than a lump sum. Studies of inherited wealth have concluded that many children spend lump sum inheritances, whereas they learn to be more responsible with inheritances paid out over time.

How a give it twice trust works

1. We can help you and your attorney with the process of creating a charitable remainder unitrust.
2. You complete an IRA or other retirement account beneficiary designation form, naming the charitable trust as the beneficiary, and return the form to the account custodian.
3. When you pass away, the custodian will transfer your retirement account to the charitable trust.
4. The trust will pay income to your spouse, children or other individual beneficiaries for their life, term of years or life plus term of years.
5. At the conclusion of the payments, the balance of the trust will be transferred to United Way of Santa Barbara County.

Contact us

Talk to your advisor to determine if this strategy fits your goals.

If you have any questions about a give it twice trust, please contact us. We would be happy to assist you and answer any questions you might have.

ANOTHER OPTION: Leave Your IRA to Charity & Other Assets to Loved Ones