Charitable Planning: Testamentary Gifts

One of the amazing things about estate planning is that it is 100% customizable to you and your needs. This is one of the reasons why it is key that you sit down with an experienced estate planning attorney when you are ready to start planning so that you have the peace of mind of knowing that your hard-earned assets go to the right beneficiaries. Although the traditional beneficiaries of an estate usually include the loved ones or even friends of an individual, there are many times where the person that is completing their estate plan wants to leave certain parts of their assets to charity. If you find yourself in this position, there are several details that you should consider as you are putting your estate plan together such as:

1. Put together a will or trust and list the charitable institution (or institutions) as your beneficiary
One of the most straight forward ways to leave behind assets to a charity is to list that charity as a specific beneficiary in your Last Will & Testament or Revocable Trust. As a specific bequest, once the assets of your estate are ready to be distributed, the charity will be the first beneficiary to receive their distribution with the remaining balance of your estate split according to your wishes among your beneficiaries. You have the flexibility to decide whether the charitable beneficiary receives a percentage of your estate or a set dollar amount

2. Make a gift of retirement accounts or stock
Another option that you have when it comes to charitable gifting through your estate is to name the charity as the beneficiary of retirement accounts or stocks that you may have. This process can be time consuming in the sense that you will need to fill out specific beneficiary forms for you to properly gift these assets after your death. However, your estate planning attorney should be able to guide you through the process and ensure that your beneficiary forms are up to date.

3. Establish a charitable remainder trust
There are innumerable people who look for ways to contribute to the well-being of a charity during their lifetime as well as after they pass away. This is something that can be accomplished through setting up a charitable remainder trust. A charitable remainder trust gives you the opportunity to make donations to a charity in a tax-free manner which can reduce your taxable income. This is a project that should always be done between an estate planning attorney as well as your financial advisor, however, there are tremendous tax benefits associated with it depending on your current income as well as your tax bracket.

Remember, if you plan to leave any part of your estate to a charity, you should reach out to them ahead of time and make them aware of this charitable distribution. The charity will be able to provide you the official address that should be used for the distribution as well as their employer identification number which is key for tax purposes both for the charity as well as your estate. There may also need to be certain wording in your documents depending on the charity that you plan to leave a distribution to.

Book Your Appointment at Our Office Today

Without question, the most important steps that you should take if you would like to leave behind any part of your estate to a charity is to collaborate with an experienced estate planning attorney. This is exactly what you will find when you work with our office. We will take the time to walk you through the different options that you have when it comes to leaving charitable distributions and organizing your estate in a way that makes you feel comfortable. Schedule your appointment with our office today.