Having a Charitable Remainder UniTrust (CRUT) in Washington State is beneficial for High-Net-Worth individuals to get immediate Income Tax Deductions, convert low-cost-basis assets (like stocks) into cash flow Tax-free (avoiding Federal Capital Gains), generate income for life/term, and reduce potential Washington State Estate Taxes (due to a lower $3 million* exemption) while making a large future gift to charity. It turns concentrated, risky assets into diversified, income-producing ones without immediate Tax hits, perfect for Washingtonians facing significant State Estate Tax exposure. 

Key Benefits in Washington State

  • Income Tax Deduction: Receive an immediate Federal Income Tax deduction for the present value of the gift to charity, allowing you to itemize and lower your Taxable income.
  • Capital Gains Tax Avoidance: The Trust can sell appreciated assets (stocks, real Estate) without paying immediate capital gains Tax, reinvesting the full proceeds for growth.
  • Income Stream: Provides you (or a beneficiary) with a variable income stream for life based on a percentage of the Trust’s value (5%), offering growing payments if assets appreciate.
  • Estate Tax Reduction: Removes assets from your Taxable Estate, which is crucial in Washington, where the Estate Tax exemption ($3 million* in 2026) is much lower than the federal level, making more Estates subject to state Tax.
  • Investment Diversification: Solves concentrated stock positions by selling them within the Tax-exempt Trust and reinvesting in a diversified portfolio, reducing risk.
  • Philanthropic Impact: Ensures a significant future gift to your chosen charity (like the UW or another) after the income term ends, fulfilling charitable goals. Why it’s great for Washingtonians
  • High State Tax Burden: Washington has the highest top marginal Estate Tax rate (35%), making it a prime state for using Trusts to reduce Taxable Estates.
  • Combined Tax Savings: You save on Federal Income Tax (deduction, capital gains), federal Estate Tax because contributions to Charitable Remainder Trusts with you as the income Beneficiary do not count against the $30 million* per couple Unified Federal Gift and Estate Tax, and Washington state Estate Tax, while generating income. 
  • A Charitable Remainder UniTrust (CRUT) does not pay capital gains Tax when it sells appreciated assets. This is one of the primary benefits of using a CRUT. However, the income beneficiaries pay income Tax on their gifts at their marginal Tax rate at the time of the gift.

Contributions to Charitable Remainder Trusts with your Children as the income Beneficiary DO COUNT against the $30 million* Unified Federal Gift and Estate Tax.  Contributions with yourself and your Spouse as Income Beneficiaries DO NOT COUNT.

  • * The Washington Estate Tax Exemption is indexed to inflation which is about .% per year. So, the $ Million* Exemption is expected to increase by about $,000 per year. The Federal Estate Tax Exemption of $ Million* per person is also indexed to inflation, so it is expected to increase the $0 Million* per couple exemption by about $,000 per year.  Estate Tax Exemptions and Tax Rates may also be adjusted periodically by passage of State and Federal Laws.