The Annuity Trust

An annuity trust provides an annual income of at least five percent of the value of the trust based on a valuation that takes place at the time it is funded. In other words, you, or the beneficiary you name, receive periodic payments of a fixed sum that is determined when the trust is established. This means you can count on a steady income in an amount that does not vary over time.

When is an annuity trust appropriate? This type of trust is most suitable for a donor who wants to give away property but wants also to retain a dependable stream of income. And, since the amount of the distribution paid by the trustee does not vary, it is an uncomplicated arrangement for both you and the trustee.

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