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Friday, April 17, 2020

How Can I Include Charitable Giving in My Estate Plan?

Many people have charitable causes about which they are passionate. When estate planning, you may wish to consider planned charitable giving which will allow you to support your charitable interests. There are several ways to include charitable giving. It will provide you with the opportunity to continue championing those causes that hold a dear place in your heart.

How Can I Include Charitable Giving in My Estate Plan?

Planned charitable giving involves structuring a charitable donation when developing your estate plan. Planning ahead for a charitable gift that may occur during your lifetime or after you pass away is a great way to maximize the benefits of such a generous act. By including charitable giving in your estate plan, you have the ability to structure the gift in a way that can account for things such as tax benefits or ramifications.

There are several different ways that you can include charitable giving in your estate plan. For instance, you may include a bequest to a charity of your choice in your will. You may do this by making a percentage bequest. A percentage bequest is when you gift a certain percentage of your estate. You may also accomplish this through a specific bequest. A specific bequest is when you specify a dollar amount or a particular asset that you want to give to a charity. In the alternative, there is also the option of a residual bequest. A residual bequest makes a gift of the remaining balance of your estate after all other distributions have been made.

Another way to include charitable giving in your estate plan is by naming a charity as the beneficiary on various accounts, including:

  • Retirement accounts
  • Bank accounts
  • Life insurance policies
  • Securities and other financial accounts

The benefit of naming a charity as a beneficiary on these types of accounts is that charities are, generally speaking, tax-exempt. This means that the charity would likely receive the full value of the account upon the death of the account holder.

Another popular way of charitable giving in estate plans is by establishing charitable trusts. One type of charitable trust is the charitable remainder trust. With a charitable remainder trust, the trust generates income to your or someone else for life. You put assets in the trust that are then invested. The investment generates income that provide you with a stream of income. At the same time, you get the benefit of deferring capital gains tax on the assets that have been moved into the trust. When you pass away, the assets of the trust are distributed to the charity you selected. There are several other types of charitable trusts. Each have specific requirements, benefits, and limitations.

Estate Planning Attorney

Estate planning provides you with the ability to look at the big picture and plan for your legacy today. Charitable giving is a great thing to build into your estate plan. It allows you to support those organizations that champion causes about which you feel passionate. It provides you with the opportunity to maximize the benefits of your generous gift by considering things such as tax implications to you, your estate, and the charitable organization. At Monk Law, we provide you with trusted estate planning legal counsel. We will develop an estate plan that reflects your unique goals and plan for the future. Contact Monk Law Firm, PLLC today.


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| Phone: 803-594-4453
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| Phone: 704-369-9977

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