IRS Issues Rev Rul on Dividing CRTs, Rev Procs on CLUTS

The Internal Revenue Bulletin issued today includes a Revenue Ruling and two Revenue Procedures of interest to nonprofit lawyers.

Rev. Rul. 2008-41 provides guidelines for dividing a charitable remainder trust into two or more separate and equal CRTs, without violating IRS 664.  If carried out according to the ruling, the division is not a sale or exchange producing a gain or loss, the division does not result in a change in the trust’s status as a trust subject to the private foundation rules, does not result in the imposition of an excise tax under 507(c), will not be considered an act of self dealing, and does not constitute a taxable expenditure.

Rev. Proc. 2008-45 provides sample inter vivos grantor and nongrantor Charitable Lead Unitrust forms, with annotations and alternate provisions.

Rev. Proc. 2008-46 provides a sample testamentary Charitable Lead Unitrust form, with annotations and alternate provisions.

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