Quicklinks
myMILLIKIN |
Search
Millikin Home
Millikin Directory
Millikin Mobile
Big Blue RSS
Millikin University - Decatur, IL
Flip Unitrust 

This variation of a unitrust provides the flexibility necessary for some assets by combining aspects of a net income unitrust and a regular unitrust. It is an excellent approach for people with illiquid or unmarketable assets to fund a trust that will make an irrevocable commitment to their favorite charity or charities.

At the onset, the trust does not have to pay any income to the trust beneficiary (or beneficiaries). After a predetermined event, such as the sale of the asset funding the trust, the Flip unitrust "flips" into a standard unitrust on the following January 1st. Since the asset in this case has been sold, the trustee has cash to invest in income-producing assets for the trust and may begin making regular income payments to the beneficiary (ies).

A flip trust provides flexibility for donors with hard to value or illiquid assets. A flip trust can be managed so that illiquid assets can be sold in a tax advantaged manner, the proceeds reinvested in a balanced portfolio and life income payments made to the donor and/or other beneficiaries.

There are many different types of events that can trigger the flip. The event cannot be discretionary and must be specified in the trust documents. Examples of some events that could be used to trigger a flip are:

  • Birth, death, marriage, or divorce
  • The sale of all or a specified part of an illiquid asset
  • A person reaching a certain age
  • A specific date

 

 

Please note, individual financial circumstances will vary. The information on this site does not constitute legal or tax advice. Donor stories and photographs are used with permission and are for purposes of illustration only. As with all tax and estate planning, please consult your attorney or estate specialist. All material is copyrighted and is for viewing purposes only. Use of this site signifies your agreement with the terms of the privacy statement. The content in this Planned Giving section has been developed for Millikin University by Future Focus. Please report any problems to webmaster.

 
 
Millikin University - Decatur, IL
Millikin University - Decatur, IL
 
Millikin University - Decatur, IL
Millikin University - Decatur, IL
Millikin University - Decatur, IL
Millikin University - Decatur, IL