The Internal Revenue Service has issued a batch of guidance that could help estate planners and others with clients who want to split charitable remainder trusts.
IRS officials write in IRS Revenue Ruling 2008-41 in response to questions about whether the “pro rata division of a trust that qualifies as a charitable remainder trust … into two or more separate trusts [will] cause the trust or any of the separate trusts to fail to qualify” as a charitable remainder trust.
The officials also write about what happens to each part of a charitable remainder trust’s basis of its share of each asset when a trust is divided in a pro rata fashion.