You donate a significant portion of, or the entire stock holding, to the CRUT, which offers three important financial benefits to the donor. First, after the stock is donated to the CRUT, you can then sell the donated stock (to meet your diversification goal) and usually, you or the CRUT may not be subject to any capital gains tax.
Second, in most situations, you may likely receive a large tax deduction for the donation, which may be very beneficial to your income tax situation. This tax deduction might partially or fully offset other income sources you have and/or offset other long-term capital gains for any investment sales made from your personal accounts (not your CRUT).
The financial benefits do not end there! The CRUT can then pay you a percentage of the CRUT principal you donated (sometimes as high as 6%) for the rest of your life. When the Trust ends (usually when you die), the remaining principal will go to the charitable beneficiary (or multiple charitable beneficiaries) that you designate.
The combination of these three benefits may be attractive and even compelling for some individuals, especially those who want to diversify a single stock position and who need additional income to fund their long-term retirement needs.