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§ 12.3 CHARITABLE REMAINDER UNITRUST RULESexercisable during the donor’s life, to add and/or substitute additional charitableorganizations as remainder interest beneficiaries. 212If all of the trust corpus is to be retained for charitable use, the tax year ofthe trust must terminate at the end of the income payment period and the trustwill cease to be treated as a charitable remainder trust for all purposes. If all orany portion of the trust corpus is to be transferred to or for the use of a charitableorganization or organizations, the trustee must have a reasonable time afterthe income payment period to complete the settlement of the trust. During thattime, the trust must continue to be treated as a charitable remainder trust for allpurposes. Upon the expiration of the period, the tax year of the trust must terminateand the trust must cease to be treated as a charitable remainder trust forall purposes. If the trust continues in existence, it will be considered a charitabletrust 213 unless the trust becomes a tax-exempt organization. 214 For purposes ofdetermining whether the trust is tax-exempt as a charitable organization, 215 thetrust is deemed to have been created at the time it ceased to be treated as aCRT. 216When interests in the corpus of a CRT are given to more than one charitableorganization, the interests may be enjoyed by them either concurrently orsuccessively. 217The governing instrument of a CRT must provide that (1) if an organizationto or for the use of which the trust corpus is to be transferred, or for the use ofwhich the trust corpus is to be retained, is not a charitable organization at thetime any amount is to be irrevocably transferred to or for the use of the organization,then (2) the amount will be transferred to or for the use of or retainedfor the use of one or more alternative organizations that are charitable entitiesat that time. This alternative organization (or these alternative organizations)may be selected in any manner provided by the terms of the governing instrumentof the trust. 218In general, the allowable charitable deduction for property transferred to avalid charitable remainder trust will be subject to the 20 percent contributionslimitation 219 when the organization designated to receive the remainder interestmay be redesignated from a public charity to a nonpublic charity. 220 This will notbe the outcome, however, when the likelihood that the remainder interest willnot go to a public charitable organization is so remote as to be negligible. 221The rules as to qualified employer securities and qualified gratuitous transferswere summarized previously. 222212 Rev. Rul. 76-371, 1976-2 C.B. 305. A charitable remainder unitrust does not fail to qualify because the grantorretains the power to change the charitable remainder beneficiary. Priv. Ltr. Rul. 9204036.213 IRC § 4947(a)(1).214 That is, becomes tax-exempt under IRC § 501(a) by reason of qualification under IRC § 501(c)(3).215 That is, an IRC § 501(c)(3) organization. See § 3.3.216 Reg. § 1.664-3(a)(6)(ii).217 Reg. § 1.664-3(a)(6)(iii).218 Reg. § 1.664-3(a)(6)(iv).219 See § 7.12.220 Rev. Rul. 79-368, 1979-2 C.B. 109.221 Rev. Rul. 80-38, 1980-1 C.B. 56.222 See § 12.2(g), text accompanied by notes 112–131. 439