Charitable Religious Trusts

The Charitable Religious Trust is created for the purpose of protecting and managing the land, properties, and portfolios, hereinafter called “holdings,” being used for preserving the welfare of the general membership of your Religious Society, which is herein designated as the Beneficiary of the Trust. 

For the past twenty-eight years there has been no IRS challenge to the tax-exempt status of his court’s creations of the Charitable Religious Trusts (CRT’s).  

Trusts are a unique “person,” separate from the originator, to hold and protect assets for your religious society (including your family), and other beneficiaries, as well as for humanitarian purposes.  

Privacy – you don’t own the Trust or property in the Trust, so you are isolated from liability.  

Provides Safety from personal lawsuits and can provide great Tax savings, with the Charitable Religious Trust, and since it is a charitable Trust, it: 

  • Eliminates the hassle of filing tax returns  
  • Eliminates probate of Trust assets  
  • The Trust can help keep at bay the relatives and other people seeking handouts.  You can say there is a committee that makes the decisions for the good of the “Society” (beneficiaries), and you must consult your team.  
  • Take care of family and others – pay for worldly needs of beneficiaries (but not necessarily wants).  It has features of a spendthrift Trust, whereby funds are not paid out to beneficiaries, but rather it can pay expenses for needs.  That is great when beneficiaries might get out of control financially.  Also, it provides for the welfare of the family for hopefully a long time, even for generations.  
  • Trusts can also donate to other Trusts and charities for humanitarian purposes.  

The Charitable Religious Trust is created for the purpose of protecting and managing the land, properties, and portfolios, hereinafter called “holdings,” being used for preserving the welfare of the general membership of your Religious Society, which is herein designated as the Class of Beneficiaries.  

In simple terms, Trusts hold things for beneficiaries.  Trusts can pretty much do everything we can personally do according to the law.  However, because we have no ownership, we have no personal liability, as we don’t own any of the corpus of the Trust.  We simply do our job as trustee and therefore control it.  

OWN NOTHING…CONTROL EVERYTHING!

You are not the Trust, nor do you Create the Trust.  The religious court creates the Trust.  You, or whoever petitions the court and accepts the position of Trustee, controls the Trust in a fiduciary capacity on behalf of the beneficiary, but has no personal liability.  No yearly admin costs.  The Trustee has full control.  

The Trust is actually a true Non-Grantor Trust.  Most Grantor Trusts are taxable.  The Trust is Created by an ORDER of a Religious Court, and is Created without assets.  In a Grantor Trust, the Grantor Creates the Trust by making a “grant” of assets into the Trust, which is held by a Trustee on behalf of a Beneficiary.  The Charitable Religious Trust is Created without assets and it is the responsibility of the Trustee to find assets for the Trust.  

Charitable Religious Trust is a legal and lawful person.  

IRS CODE 

The Trust essentially utilizes the rules of the IRC to become exempt from income tax.  Whereas Common Law Trusts derive their validity through Article 1, section 10 of the Constitution (obligation of contracts clause), the Charitable Religious Trust derives its validity through the First Amendment’s “Free Exercise” clause. 

Of course, the Trust must be managed according to the established rules.  The Charitable Religious Trust is not meant to be our personal bank account.  The rules are quite simple really; however, the trustee is responsible to manage the Trust responsibly.  

The Charitable Religious Trust is classified as being a 501(c)(3) organization, and 501(c)(3) entities are tax exempt. 

The trust can also accept tax exempt donations and give receipts therefore, because the donor is giving to a charitable religious entity under the Internal Revenue Code.

IRS Code section 508(c)(1)(A) says that all 501 entities must request recognition by the IRS before they can claim tax exempt status, EXCEPT, when a religious entity is operating as a tax-exempt entity, the entity does NOT have to seek recognition by the IRS, because the religious entities are automatically tax exempt under the first amendment. 

IRS Code section 6033(a)(3)(A) says that all 501 entities must file a tax return, EXCEPT, when that 501 entity is also a religious organization that is exempt from filing a tax return under the first amendment the entity has no obligation for filing a tax return.  

Charitable Religious Trusts are defined in the IRC as a Religious Society, allowing tax exempt status without filing, paying or reporting to the Internal Revenue Service.  

The EIN, which is received on a CP 575 E, is only requested for the purpose of getting a bank account, and not for taxing purposes.  

Trusts are used for INSULATING assets and for ISOLATING liabilities. 

By placing assets such as gold coins, silver coins, Cryptos, foreign currencies, and other items against which a law suit might be filed is very rare, these assets are INSULATED against attack caused by damage caused by something outside of that Trust. 

Trusts ISOLATE the potential liability that exists when an automobile gets into an accident, or someone falls down a staircase in your home.  Because any claim for damages must be settled out of the holdings of the particular Trust that owns the automobile or house, this ISOLATES the damages, which must come from an insurance policy, the automobile, the house, or other Trust property.  This is why trusts are so important in this litigious world.  

It is prudent to place all property with a potential liability into separate trusts.  Examples: Cars, homes, boats, etc.  That way if there is a lawsuit resulting from claims against one of these liabilities, they cannot attack other properties.  An accident in the automobile does not place the home at risk.  The claimants can only go after the Trust that owns the property.  

Please seek legal advice, as I have no license to offer services regarding the commercial Admiralty jurisdiction and court system.  However, because these trusts do not fall under their common law or statutory jurisdiction, then we utilize their IRC and legal precedent when we discuss the advantages of Trusts.