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§ 12.3 CHARITABLE REMAINDER UNITRUST RULES2. A transfer to a trust is treated as if the transfer had never been madewhen a court having jurisdiction over the trust subsequently declaresthe trust to be void (because, for example, application of the 10 percentrule frustrates the purposes for which the trust was created) and judicialproceedings to revoke the trust are commenced within the period permittedfor reformation of CRTs. The effect of this “unwinding” of thetrust is that any transactions engaged in by the trust with respect to theproperty transferred, such as income earned on the assets transferred tothe trust and capital gains generated by sales of the property transferred,will be income and capital gain of the donor (or the donor’s estate if thetrust was a testamentary one) and the donor (or the donor’s estate if thetrust was testamentary) will not be permitted a charitable deductionwith respect to the transfer. The statute of limitations applicable to adeficiency of any tax resulting from this type of unwinding of a trustmay not expire before the date one year after the IRS is notified that thetrust has been revoked. 138(j) Charitable DeductionsAny claim for a charitable deduction on any return for the value of a remainderinterest in a CRAT must be supported by a full statement attached to the returnshowing the computation of the present value of the interest. The federal incometax charitable contribution deduction is limited to the fair market value of theremainder interest of a CRAT regardless of whether a charitable organizationalso receives a portion of the annuity. 139§ 12.3 CHARITABLE REMAINDER UNITRUST RULESA charitable remainder unitrust is a trust that complies with the foregoingrules 140 and the rules described in this section. 141(a) Payment of Unitrust AmountThere essentially are four types of qualifying CRUTs, with the distinctionsamong them principally being the way in which the unitrust amount is calculated.In the case of the second and third of these types of trusts, discussedbelow, the amount paid to one or more income beneficiaries from the trust is afunction of actual trust income.138 H. Rep. 105-220, 105th Cong., 1st Sess. 147 (1997). There is a third relief rule; it is summarized in text accompaniedby note 231.139 Reg. § 1.664-2(d). The rules for calculating this deduction are summarized in § 12.11(a). For the rules relatingto the reduction of the amount of a charitable contribution deduction with respect to a contribution of certainordinary income property or capital gain property, see §§ 4.4, 4.5. For rules for postponing the time for deductionof a charitable contribution of a future interest in tangible personal property, see § 9.21.A transfer by a beneficiary of a life interest in a charitable remainder trust of that interest to the remainderinterest beneficiary charitable organization is a deductible gift for income tax purposes. Rev. Rul. 86-60, 1986-1 C.B. 302.140 See § 12.1. The division of a unitrust does not disqualify the resulting trusts. Priv. Ltr. Rul. 9403030.141 IRC § 664(d)(2); Reg. § 1.664-3(a). 427