Net‐income charitable remainder unitrust (NICRUT)

A form of charitable trust in which the donor is paid a fixed percentage of the trust assets annually. The principal assets of the trust are not distributed, the donor only receives a distribution if the trust has earned enough interest to cover the annual payment to the donor.

A Variation of the NICRUT is the Net income with makeup charitable remainder unitrust (NIMCRUT). The two are the same except that if the NIMCRUT earns more than the fixed percentage during a later year, the trust is able to make up an earlier shortfall due the donor.

Estate Planning Glossary

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