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Level 2

Solved

Charitable donations - unitrust or CRT

Forum|Forum|6 years ago
February 24, 2020
41 replies
211 views

How do i report contributions to a unitrust or CRT? I can't find anything in turbo tax related to these topics.

Best answer by DaveF1006

Yes. here is how you will report this.

Log into Turbo Tax.
Go to federal>deductions and credits>Charitable Donations>show more
Donations to Charity in 2020>stat or revisit
You will report it as a donation to property so you will pick items after you list the name of the charity
Now you will answer the questions over the next few screens
in choosing the category, choose other intangible property.
When it ask what the description, value and method of determining value, select present value. the description would be the Unitrust- Charitable Remainder Trust
Next screen asks purchase info, select created as the method of purchase.
Finish out the interview. If done correctly, the information will populate into Section B-part 1 of the 8283.

RobertG

Level 12

Here is some guidance on that subject.

Charitable Deduction for a charitable remainder unitrust, (CRUT)

The rules for calculating the value of a remainder interest in a CRUT are in Regs. Sec. 1.664-4. Generally, the present value of the remainder interest (i.e., the charitable deduction) in a CRUT is determined by finding the present-value factor that corresponds to the trust’s adjusted payout rate. The present-value factor for a CRUT with an income interest payable for a term of years is in Table D, Term Certain Factors, of Publication 1458. The present-value factor for a CRUT with an income interest payable for the life of the noncharitable beneficiary is in Table U(1), Single Life Factors, of Publication 1458. Most of both tables is reproduced in Regs. Sec. 1.664-4(e)(6). If the income interest is payable for the lives of two individuals, use Table U(2), Last-to-Die Factors, in Publication 1458, which is available here.

The Tax Advisor

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JLafAuthor

Level 2

Robert, thanks for the reply, but I know the amount available for a deduction on my taxes. What I don't know is how to enter this in turbo tax. Entering a stock gift simply asks for the amount, basis and dates.... where and how do I enter the calculated charitable deduction? thanks

RobertG

Level 12

You just report it as a contribution of property.

See IRS publication 526: Contributions of Property

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spizz1

Level 2

Here I am in 2021 trying to report contributions to a unitrust. Can it be done in turbo tax?

DaveF1006

Level 15

Yes, it would be reported as a contribution of property. See IRS publication 526: Contributions of Property. When you report it in the charitable contribution section, it will be reported as an item. According to the link, it is reported at the Fair Market Value of the trust.

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spizz1

Level 2

Dave, yes you are correct. Here's the issue: It has to be reported on form 8283 under Part II "Partial Interests and Restricted Use Property". I've called the Turbotax help line and the person did not understand the issue and tried to tell me that form 8283 isn't used with a 1040 form. That shows the people working the phones don't understand how taxes work.

My only question is, can "Turbotax Home & Business" actually allow someone to report it in Part II "Partial Interests and Restricted Use Property" on form 8283? I've read other conversations from last year here in intuit turbotax and no one has accurately explained 1) that it can be entered in Part II and 2) how to do it. This version of Turbotax clearly has limitations in what you can enter. If you think that it's possible, can you open up "Turbotax Home & Business" and enter a hypothetical unitrust example and get it to show up correctly in Part II? If it shows up in Part I then the IRS will not accept it as filed correctly. Thanks in advance for your help.

DaveF1006

Level 15

I actually worked out a scenario and got this to appear correctly in part 11 of the 8283. Now let me list the steps. I did this with you in mind.

Keep in mind, the only way this will be populated on the 8283 is that you indicate that you gave away less than an entire interest listed in Section B part 1.
OR if there were conditions you place on the Section B part 1 contribution.
If the answer is yes to both, then let's proceed.
Now go to the charitable contribution section of your return.
in choosing the category, I chose other intangible property.
When it ask what the method of determining value, I said present value.
Next screen asks purchase info, I put in created as the method of purchase.
Then scrolled through the screen until it asked for the name and address of the charity.
On the next screen, it asks if either you retained partial ownership of the donation or
If you attached conditions. If you say none of the above on this screen, the information will not populate in Part 11 of the 8283. So let's say yes to this particular example.
Next screen will ask if you retained partial ownership, say yes.
Next screen will ask if you contributed in a prior year. If yes, then it will ask you the name of the charity you contributed to in prior years.
Next question will ask if you placed special conditions on the contribution. if so, what were they?
You can also edit the information in the form entitled additional info(XXX) underneath the Charitable Org (XXXX) form in your list of forms.
Remember the two requirements for the information to populate in Part11 of he 8283.

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berndog

Level 2

When I tried that method it stopped and said Contact a Pro to do this, would not go on from there??

The CPA that set up my Charitable Remainder Trust said that stock goes on Form 8283 Section B Part 1.

How can I get it in there with TT Deluxe???

Thank you

DaveF1006Answer

Level 15

Yes. here is how you will report this.

Log into Turbo Tax.
Go to federal>deductions and credits>Charitable Donations>show more
Donations to Charity in 2020>stat or revisit
You will report it as a donation to property so you will pick items after you list the name of the charity
Now you will answer the questions over the next few screens
in choosing the category, choose other intangible property.
When it ask what the description, value and method of determining value, select present value. the description would be the Unitrust- Charitable Remainder Trust
Next screen asks purchase info, select created as the method of purchase.
Finish out the interview. If done correctly, the information will populate into Section B-part 1 of the 8283.

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Pedalboat

Level 2

I got real far inputing a CRUT donation into Turbotax 2021, BUT, I do not see any option to show that I gave away less than a full interest. As long as I only put the calculated donation value and the prorated tax basis, my numbers look fine.

Am I do something wrong, or is this a change with the 2021 version?

sfeldman

Level 2

Not clear if you have donated appreciated real property, or something else. I also wonder what "less than a full interest" means in your particular case; I'm no expert, but I seem to recall a checkbox for such a situation.

Pedalboat

Level 2

I am donating appreciated real estate and my donation present value is 10.011%. So I am entitled to that percent of the appraised value as a donation. I did not see any place where you can check a box etc to describe such a partial interest. In rereading this thread it does sound like such an option does not exist. Worst case, since the return has to be mailed in I can just do 8283 manually. AS long as the correct info gets to the other forms.