Charitable Remainder Trust Cost

Two of the most important questions customers often ask us is “How much does a charitable remainder trust cost?” and, just as importantly, “How does it compare to the competition?” In this article we are going to explain the key charitable remainder trust expenses, what Valur charges , and how Valur compares to the competition!

What Does A Charitable Remainder Trust Cost?

Each layer of tax and estate planning will typically cost you something. So what are the various charitable remainder trust expenses you need to be concerned about? Let’s outline each of them below:

  • Trust Education and Formation – Setting up a trust has historically required paying a lawyer and fees typically range from $10k-$25k (or more) depending on the lawyer and your needs. Even if you decide not to set up the trust, just the consultations and analysis typically cost you something.
  • Trust Administration and Tax Preparation – You’ll have to find a third party administrator and tax preparer that understands the accounting, tax filing and regulatory requirements of Charitable Remainder Trusts. The fees typically range from 0.5% to 1.1% of assets annually (or 50bps to 110bps).
  • Qualified Appraisal Services – When any non-cash or publicly traded stock gift is made to the trust you’re required to receive a qualified appraisal for those gifts if you want to receive a charitable deduction. (which you should!). These typically cost anywhere from $500 – $10,000 depending on the type of asset.
  • Trustee Fees – When you speak to most lawyers, they may push you to pay for high cost third party trustees. When in fact, these trusts don’t require it, except in rare scenarios.

Charitable Remainder Trust Cost – Comparison

Below we’ve included the costs for Valur and some of the most popular trust administration companies to show you how we stack up to them. These providers offer a variety of services but we’ve exclusively outlined the basic costs for charitable remainder trust administration.

CompanyMinimum Annual   FeeFirst $1 millionFirst $5 millionAbove $5 million
J.P. Morgan$15,0000.55%0.55%0.35%
Charles Schwab$5,0000.50%0.50%0.25%
Northern Trust$20,0000.40%0.40%0.20%
Wilmington Trust$8,0000.60%0.40%0.25%
Charitable Remainder Trust Cost

Valur is clearly one of the lowest cost solutions in the market when it comes to trust administration. But those are only the costs for trust administration, how much does it cost to set up a charitable remainder trust as well? Let’s see what that would look like with a real customer example.

Charitable Remainder Trust Costs When Selling A Business

Let’s run through a realistic example of what it would cost a customer to set up and administer their Charitable Remainder Trust. Assume this individual is selling their business for $8 million.

CompanyTrust Education &   FormationAnnual Trust   AdministrationTotal First Year   Costs
Valur$0 (included in our   services)$20,000$20,000
J.P. Morgan$15,000*$38,000$53,000
Charles Schwab$15,000*$32,500$47,500
Northern Trust$15,000*$26,000$41,000
Wilmington Trust$15,000*$29,500$34,500
Charitable Remainder Trust Cost When Selling A Business

Typical attorney cost ranges from $10,000-$25,000. We are not indicating that these firms will provide you with a lawyer or services, only that by using them you’ll likely incur those costs with a lawyer directly.

In this situation, on a trust expected to last 50 years (average for a 30 year old) the higher Charitable trust administration costs from JPMorgan could ultimately cost this customer more than $10 million dollars in lower distributions for them and their family.

As you can see our integrated model enables us to set up, administer and offer these structures to you at a significantly lower cost and over time these saved fees really add up and cost you and your family. Not only do we provide more services at a cheaper price but we make a point to provide these services at a higher quality.

What VALUR Does For Your Trust

Our team at Valur makes it a point to make setting up and administering CRTs seamless for you all at a lower cost compared to the competition.

  • Tax Education – We provide complimentary education resources as we believe it shouldn’t cost anything to access the necessary information required to make informed decisions about your trust and its financial impact.
  • Trust Formation – We create your customized trust documents on demand and set up the associated accounts. (There’s no costs at this stage, you can truly set up your trust for free with no obligation.)
  • Tax Preparation – These services are embedded in our platform and are included with no extra cost. We’ll give you the personal forms you need and file the required trust tax filings each year and you’ll never be burdened by the trust’s ongoing required tax filings.
  • Qualified Appraisal Services – We have a variety of value-added partners on hand, that can provide a qualified appraisal for assets of any kind. We manage the process, making it simple and seamless.

Next Steps

When compared to the competition, Valur offers a valuable Charitable Remainder Trust at the lowest cost. All while managing every step of the process from deciding which trust to setup, creating the trust documents and setting it up and administering your trust. People often ask us how we are able to do this. It comes down to our proprietary technology platform which automates our offerings instead of relying upon expensive lawyers and trust administrators.

Access – at no cost – our easy-to-use calculator to evaluate the potential return on investment given your situation. And if you have any questions, contact us through our chat button below, or schedule a meeting with our team.

About Valur

We have built a platform to give everyone access to the tax planning tools of the ultra-rich like Mark Zuckerberg (Facebook founder), Phil Knight (Nike founder) and others. Valur makes it simple and seamless for our customers to utilize the tax advantaged structures that are otherwise expensive and inaccessible to build their wealth more efficiently. From picking the best strategy to taking care of all the setup and ongoing overhead, we make take care of it and make it easy.