Everything you always wanted to know about charitable lead trusts but were afraid to ask.

By Kathleen Stephenson and Lisa B. Petkun

For example: A donor transfers $500,000 to a charitable lead annuity trust, specifying that an annuity of $15,000 be paid to a nonprofit for 10 years. On the month the transfer is made, the applicable federal rate is 5 percent. The value of the remainder interest at the time of the transfer is $384,174.