Much of estate planning involves creating a comprehensive plan for caring for your family and loved ones after you are gone, such as selecting a power of attorney or determining custody for your dependent children. However, you can also continue to contribute to a cause you are passionate about by leaving some of your estate to one or multiple charitable organizations. Charitable planning with experienced Raleigh attorneys allows you to determine the best course of action to reduce taxes for your family while ensuring your causes are provided for.
At Kirk, Kirk, Howell, Cutler, and Thomas, LLP, we provide charitable planning services you can feel confident in. We work with you to not only benefit the causes and charities you are passionate about, but to also benefit your family. With our expertise, we know the best options for charitable giving and can provide a custom strategy based on your assets and estate.
Why Choose Charitable Planning?
Charitable contributions not only continue your philanthropy, it can lead to large amounts of estate tax and income tax savings for your loved ones and heirs. In most cases, there is no limit to the tax deduction for donations to a charity, and this can significantly reduce the taxable estate.
It’s important to note that charitable planning is not just for wealthy individuals or those with large estates and holdings. Even people with minimal assets can set aside a portion for a specific cause, whether it’s a portion of life insurance, employee stock options, or the proceeds from selling specific property.
Selecting Your Charitable Beneficiaries
Perhaps you currently donate your time or money to a specific cause that’s dear to you, and you want to continue your philanthropy after you’re gone, or maybe you haven’t had the opportunity to donate but want to sustain a charity. It’s important to choose a charity or multiple charities that align with your values, but that also offer the estate benefits that reduce burden on your heirs. We can help you determine the best options that meet all your requirements.
When you donate to a charity or foundation, it’s often a monetary gift. However, many non-profit organizations and charities accept other donations, especially when it is coming from a Last Will. In your estate planning, you can specify gifts including:
- Real estate, including land or residential property
- Life insurance or retirement plan proceeds
- Stocks and mutual funds
- Valuable property, such as artwork, antiques, or jewelry
Choosing Charitable Planning Options with Your Raleigh Attorney
There are multiple options for how you can set up charitable giving. For example, you can set up your estate to ensure that your spouse or children receive income from your annuities or a trust, then transfer the residual principal to a charity upon their passing. We will take a comprehensive look at your estate, outline your options, and help you select the best structure to benefit both your preferred charity and your loved ones.
One Time Charitable Donation
A one-time charitable donation provides a specific amount of money or a set percentage of your estate to your charity. This reduces the entire taxable amount of your estate and can reduce the tax burden on your loved ones.
Charitable Remainder Trust
A charitable remainder trust is a tax-exempt trust that is irrevocable, meaning once you set it, you nor your heirs can change it or modify it. There are two options for charitable remainder trusts:
- Charitable remainder annuity trusts distribute a set amount each year, such as $2000 per year from a retirement annuity.
- Charitable remainder unit trusts that distribute a set yearly percentage based on how much is in the trust itself. For example, if the trust fluctuates due to stock amounts, you can set only 10% of the balance goes to the charity.
Charitable Lead Trusts
A charitable lead trust reduces your taxable income by donating a fraction of the trust to a specified charity. Then, once the taxes are reduced, the remainder goes to your heirs or beneficiaries.
Creating a Foundation
For large amounts of wealth you want to go to charity, a foundation could be your best option. This option allows you and your heirs more control over where your money goes, setting up grants and scholarships for causes and individuals you find worthy. This option requires in-depth administration, and in your will, you would have to set up a person or a board of trustees.
Contact Experienced Raleigh Attorneys to Assist with Estate Planning
Whether you’re wishing to set aside a small donation to a cause or you have a vast estate, trust Kirk, Kirk, Howell, Cutler, and Thomas, LLP. Our Raleigh legal team can help you with your charitable planning that maximizes your impact on a cause that’s important to you while still offering solutions that take care of your loved ones. Contact us today at (919) 615-2473 or fill out the form below to reach out to us.
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