How can I use a CRT to assist my elderly parents?

As our population ages, many working families are finding it necessary to save not only for their own retirement but also for the possibility that they will have to provide some financial assistance to their parents. Such assistance is not tax deductible and may result in gift tax consequences if it exceeds certain amounts. A CRT offers a simple solution to this dilemma. You can transfer assets to a CRT that will provide a fixed income for life to an older relative instead of income for yourself. You will be entitled to a substantial charitable deduction for your gift to the trust and also be assured of proper management of the assets in the event you become unable to manage them yourself. At your parent’s death, the trust ends and the assets will be distributed to your favorite charity—perhaps even in your parent’s name.