How to handle CRUT income?
I'm considering a CRUT but am not sure how to handle the income. For withdrawals I'm experimenting with using Special Receipts dividing what could be received into ordinary income and capital gains and dividend components. Over my expected lifetime I'm guesstimating a small real percentage portfolio increase each year. However would it be better modeled as a portfolio under Monte Carlo simulation given its makeup (i.e., the usual diversified portfolio created by the charitable institution)? But unlike a held portfolio there's no spend-down; i.e., the agreed-upon percentage income thrown off is received but the remainder, upon my untimely demise, goes to the charity (unless I'm completely misunderstanding how portfolio's are handled under Monte Carlo simulation). Or should it be treated as an annuity? Suggestions?
Obviously, the flip side is how best to model creating a CRUT with existing assets but to keep things simple for now that'll be another question.