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CRT ADMINISTRATION

While the law does not mandate a professional administrator for a CRT, there are numerous important advantages to consider. 
 

  • CRTs are treated as private foundations for numerous aspects of tax law. The rules governing private foundations are intricate and extensive.

  • CRTs are subject to taxation under Section 664 of the Internal Revenue Code. The taxation principles differ from those applied to most other entities.

  • CRTs vary in form and size, necessitating distinct accounting and reporting requirements for various trusts, or even for the same trust at different stages of its existence.

  • Because CRTs are charitable entities and payments are made to a non-charitable beneficiary, there is a potential for trustees and/or beneficiaries to incur significant excise taxes.

At CRT Experts, we review hundreds of CRTs every year. These can be divided into two groups: those administered by a professional and those that are not. A distressingly large proportion of the CRTs not overseen by a professional exhibit some form of compliance irregularity. And problems can still arise even when a professional is involved, particularly if that professional lacks the necessary specialized expertise.

At last count (1/1/2024), the team at CRT Experts had reviewed more than 9,000 CRTs over the last two decades.

Although professional administration is not required, most advisors

suggest it to safeguard their clients' interests.

Our Administration Services

CRT Experts offers comprehensive, turnkey administration services regardless of the type of CRT, structure complexity or funding asset.

Our Services Include:

  • Compliance: Ongoing support from a CRT administration expert will help you keep your CRT on track. You'll avoid self-dealing, step transactions, and trust DNI miscalculations that can be complications for CRT trustees.

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  • Tax Reporting: We prepare your Federal and state charitable trust tax returns with plenty of time for review, questions, completion of personal tax returns, and timely filing with the IRS.

  • Annual Report: The required annual report prepared by CRT Experts for the trustee provides a clear and concise trust performance summary for the year and graphically compares current year trust valuations to previous year trust valuations. It also includes an itemized trust valuation report and a four-tier accounting report showing trust income and expenses for the year.

Our administrative services are competitively priced based on trust size and the scope and complexity of the engagement. To learn more, call us at 703-520-2275 or email us at experts@crt-experts.com.

  • Four Tier CRT Accounting: Correctly applying the CRT four tier accounting rules is critical. The CRT Experts administration system tracks and inputs each trust transaction into all of the appropriate tiers required for CRT accounting. 

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