Tuesday, October 30, 2012
I am one that rare species of Nonprofit Law profs who is not a tax expert, so this post falls under the category of "stories that look interesting but I don't really understand." According to The Chronicle of Philanthropy, Mitt Romney uses a tax sheltering device, called a "charitable remainder unitrust," that "permits him to use a charity's exemption to defer taxes on capital gains from the sale of assets . . .." The device, akin to "renting from your favorite charity of its exemption from taxation," was outlawed in 1997 but individuals who had existing trusts at that time are permitted to continue benefiting from them. Perhaps one of our tax experts can explain further.