If you have an estate plan, something you may want to do is to take steps to leave behind charitable contributions or donations. Having a strong estate plan in place can help you do this. Whether you want to donate to a university that you attended or a hospital where you received care in the past, your attorney can help you designate a portion of your assets for that cause.
There are a few different ways to leave behind a legacy through charitable contributions. The primary form with which you should be concerning yourself in your estate plan is a charitable remainder trust.
What is a good trust to use for donations or contributions to a cause?
A charitable remainder trust is a way for you to leave behind assets to the charitable organization of your choice. There can be tax benefits that come from doing this, which may benefit your estate even following your death. With a charitable remainder trust, you’re able to establish the trust while you’re living and even get recognition for doing so.
To whom can you leave a charitable remainder trust?
With a charitable remainder trust, you can donate to any not-for-profit organization and to facilities or businesses such as:
- Churches
- Universities
- Civic organizations
- Arts organizations
How does a charitable remainder trust have a positive impact on your estate?
When you set up a charitable remainder trust for another party, the trust is granted permission to sell appreciated assets without having to pay federal taxes on the gain. Any proceeds collected from the sale of appreciated assets can be reinvested once again, resulting in higher yields. You may also be able to receive a deduction for your estate, income taxes and for gift-tax purposes. Within the trust, undistributed capital gains and earnings collect tax-free.
What should you do if you want to leave behind a legacy through charitable giving?
If you want to leave behind assets to provide for a favorite charity, hospital or other facility, it’s important to talk to your attorney about the right methods for doing so. If you set up the contributions through a trust or other options, you may be able to receive benefits that reduce taxes on your estate or even benefits that affect you while you’re still alive. Your attorney will review the possibilities in Florida at your consultation, so bring information related to your intended contribution to discuss it in detail.