Does a Charitable Lead Annuity Trust need a Tax ID (EIN)?

In short: Yes. But the longer answer is a little more complex. First, a charitable lead annuity trust is a special type of trust that delivers benefits to the donor, beneficiary, and charity. During a charitable lead annuity trust, a donor places their assets within an irrevocable trust account. This trust account (which does need its own Tax ID, also known as EIN), pays out an annuity to a charity for as long as the duration of the trust. Then, once the trust expires, the assets in the trust is given to the beneficiary.

For the donor, they are no longer responsible for taxes associated with the asset any longer. It’s held within the trust, and the trust is responsible. For the beneficiary, they know they will eventually acquire the asset. And for the charity, they know that they will get these structured payments throughout the period.

But because the donor no longer has control over the trust or its assets, the trust can’t file under the donor’s SSN/ITIN. Instead, it needs its own. That’s where a tax ID or employer identification number comes in.


Written by Maurice Mallory