A CRT may be useful if you have a concentrated stock position that you want to diversify while benefiting charity. If you contribute appreciated stock to the trust, the trust can sell it—and because the trust is taxexempt, it doesn't have to pay capital gains taxes on the sale. Then the proceeds from the sale can be reinvested in a diversified portfolio within the trust. Income that's generated by that portfolio is distributed by the trust to you or a family member. Although this income is taxable, spreading it out over time helps avoid the immediate tax impact that would otherwise come when the stock is sold. A CLT can be a great strategy to reduce wealth transfer taxes on the giſt to family or heirs that occurs aſter the initial term of the trust, when your selected charity has benefited. A CLT is particularly well suited for assets that generate passive income and are expected to appreciate. This type of trust can also be structured to provide a charitable income tax deduction when it makes sense from a tax perspective. The choice between a CRT and a CLT can become clearer aſter considering your tax situation, giſting intent and charitable goals. These trusts are sophisticated planning techniques, so be sure to consult your advisor as well as an attorney who is experienced in creating charitable trusts.