CRAT vs CRUT Comparison Calculator 2026 β Charitable Remainder Trust
Compare CRAT and CRUT side-by-side with May 2026 Section 7520 rate of 5.2%. Calculate charitable deduction, annual payments, 10% minimum remainder test, and year-by-year projections.
Trust Parameters
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Quick:
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IRS requires 5%β50%; must pass 10% remainder test Fixed-term trusts: max 20 years
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Used for CRUT balance projections %
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IRS publishes monthly; May 2026 β 5.2% $0
CRAT Charitable Deduction
$0
CRUT Charitable Deduction
$0/yr
CRAT Annual Payment (fixed)
$0/yr
CRUT Year-1 Payment
CRAT vs CRUT Comparison at Your Inputs
| Feature | CRAT | CRUT |
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How CRAT and CRUT Differ
Both trust types provide lifetime or term income streams with an eventual charitable gift and an upfront tax deduction. The key choice is between certainty (CRAT) and flexibility (CRUT). Both must satisfy IRS requirements including minimum 5% payout, maximum 50% payout, and the 10% minimum remainder test.
Key Formulas
CRAT Annual Payment = Initial Funding Γ Payout Rate (constant every year)
CRUT Annual Payment = Trust FMV (revalued each year) Γ Payout Rate (fluctuates)
CRAT Remainder = PV of (Funding β PV of Fixed Annuity Stream at Β§7520 rate)
CRUT Remainder = Funding Γ (1 β Payout Rate)^Term (simplified)
10% Test: Charitable Deduction β₯ 10% Γ Initial Funding
Β§7520 Rate (May 2026): 5.2%
CRUT Annual Payment = Trust FMV (revalued each year) Γ Payout Rate (fluctuates)
CRAT Remainder = PV of (Funding β PV of Fixed Annuity Stream at Β§7520 rate)
CRUT Remainder = Funding Γ (1 β Payout Rate)^Term (simplified)
10% Test: Charitable Deduction β₯ 10% Γ Initial Funding
Β§7520 Rate (May 2026): 5.2%
Sources and References (click to expand)
- IRC Section 664 β Charitable Remainder Trusts
- Treasury Regulation 1.664-2 β Charitable Remainder Annuity Trust (CRAT)
- Treasury Regulation 1.664-3 β Charitable Remainder Unitrust (CRUT)
- IRS Section 7520 Interest Rate Table β Monthly Rate Publication
- IRS Publication 1457 β Actuarial Values: Alpha Volume (CRT Factors)
- IRS Charitable Remainder Trusts β Overview and Resources
Extended
Side-by-Side Projection: CRAT vs CRUT Year-by-Year
Year-by-year payment, asset balance, and charitable remainder for both CRAT and CRUT with SVG line chart
Year-by-year side-by-side projection of CRAT and CRUT payments, asset balances, and ending charitable remainder based on your inputs above.
CRAT vs CRUT: Annual Payments & Asset Balance Over Term
| Year | CRAT Payment | CRAT Balance | CRUT Payment | CRUT Balance | CRUT vs CRAT Payment |
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Frequently Asked Questions
What is the key difference between a CRAT and a CRUT?
A CRAT (Charitable Remainder Annuity Trust) pays a fixed dollar amount each year β calculated as a percentage of the initial contribution β and never changes regardless of investment performance. A CRUT (Charitable Remainder Unitrust) pays a fixed percentage of the trust assets as revalued annually, so payments fluctuate with market performance. CRATs offer income certainty; CRUTs offer inflation protection and growth potential.
Can I add assets to a CRAT or CRUT after the initial funding?
No additional contributions can be made to a CRAT after initial funding β this is a fundamental characteristic. CRUTs, however, can receive additional contributions at any time, which makes them more flexible for ongoing charitable planning. Additional CRUT contributions also increase the annual payout because payments are based on the annually revalued total trust assets.
What is the 10% minimum remainder test?
IRS regulations require that the present value of the charitable remainder interest must equal at least 10% of the initial contribution at the time the trust is created. If the combination of payout rate, trust term, and Section 7520 rate produces a charitable remainder below 10%, the trust does not qualify as a valid CRT. Higher payout rates and longer terms reduce the remainder value and make it harder to pass this test.
What is the Section 7520 rate and how does it affect my CRT deduction?
The Section 7520 rate, published monthly by the IRS, is used to value the charitable remainder interest for tax purposes. In May 2026, the rate is approximately 5.2%. A higher 7520 rate generally increases the present value of the charitable remainder (since future income payments are discounted more heavily), resulting in a larger charitable deduction. The month the trust is created can be chosen from the current or either of the two prior months to optimize the deduction.
How are CRT distributions taxed to the income beneficiary?
CRT distributions to beneficiaries follow a four-tier ordering rule: (1) ordinary income earned during the year and carried forward from prior years; (2) capital gains from property sold in the trust; (3) other income such as tax-exempt interest; (4) return of corpus. This means if the trust sold highly appreciated property, distributions will first carry the character of those capital gains until all gain is distributed β potentially over many years.