Back in the summer of 2010 there was a poignant story circulating in the financial community involving a challenge that was issued by two of the most high profile billionaires in the world. Bill Gates and Warren Buffett called on the nation’s richest people to consider giving away half of their wealth to charity over the course of their lives. Buffett himself “walks the walk” as it were because he has promised to give away almost all of his fortune to charity eventually. He has already given some $8 billion to the Bill & Melinda Gates Foundation over the last several years.

Of course most of us are not in a position to start a charitable family foundation, and it takes a considerable amount of wealth to be able to give away half of it and still provide for your family members. However, this does not mean that only the mega-wealthy have the desire and the ability to support charitable causes. Many people include charitable giving as part of their estate plans, and in a lot cases there are tax benefits that come along as a reward for your generosity.

One charitable giving vehicle that you may want to consider is the charitable remainder unitrust or CRUT. With these trusts the grantor names both a charitable and a non-charitable beneficiary. The non-charitable beneficiary must receive annuity payments from the trust equal to between 5% and 50% of its value each year. Most of the time the grantor of the trust will act as the beneficiary and receive these payments.

When the trust is created a term is set, and upon its expiration or the death of the grantor the charitable beneficiary assumes ownership of the remainder, and this amount must be at least 10% of the original contribution into the trust.

By funding the trust you are removing assets from your estate and gaining estate tax efficiency, and you are also entitled to a charitable deduction based on the remainder interest. There are capital gains tax advantages as well if you were to fund the trust with appreciated securities, and you can find out all the details by arranging for a consultation with your estate planning lawyer.