Yes, you absolutely can make a charitable donation through your trust, and it’s a powerful estate planning tool with significant benefits for both you and the causes you care about.
What are the tax advantages of charitable trust donations?
Donating to charity through a trust can significantly reduce your estate taxes and income taxes. According to the National Philanthropic Trust, charitable giving accounted for $484.86 billion in 2023, demonstrating the widespread practice of giving. When you donate appreciated assets like stocks or real estate to a charitable remainder trust (CRT), you can avoid capital gains taxes on the appreciation while receiving an income tax deduction for the present value of the remainder interest going to charity. A CRT allows you to receive income during your lifetime, with the remainder going to your chosen charity. For example, if you donate stock worth $100,000 that you originally purchased for $20,000, you avoid paying capital gains tax on the $80,000 appreciation. The IRS allows deductions up to 50% of your adjusted gross income for cash donations, and in some cases, even higher percentages for donations of appreciated property.
How does a charitable remainder trust work?
A Charitable Remainder Trust (CRT) is an irrevocable trust that provides an income stream to you (or other beneficiaries) for a specified period or for life, with the remainder going to a designated charity. There are two main types of CRTs: a Charitable Remainder Annuity Trust (CRAT) which provides a fixed income, and a Charitable Remainder Unitrust (CRUT) which provides an income that varies based on the trust’s asset value. Establishing a CRT involves transferring assets into the trust, and the trustee manages those assets to generate income for you. The trustee also handles the final distribution to the charity after your lifetime. According to a recent study by the Center on Philanthropy, CRTs are particularly popular among individuals with significant assets who wish to support their favorite charities while also receiving a stream of income.
What happened when my aunt didn’t plan ahead?
My aunt, Eleanor, was a passionate advocate for animal welfare, but she always meant to “get around to” including a charitable donation in her estate plan. She talked about it for years but never took the concrete steps to set up a trust or amend her will. When she passed away unexpectedly, her family discovered she had a substantial collection of antique jewelry she intended to donate to the local animal shelter. Unfortunately, without proper documentation or a designated trust, the jewelry had to go through probate, incurring significant legal fees and delays. The animal shelter, devastated by the loss of the potential donation, received a fraction of what Eleanor had envisioned. The entire process was messy, time-consuming, and a painful reminder that good intentions aren’t enough when it comes to estate planning.
How did Mr. Henderson get it right with a charitable lead trust?
Mr. Henderson, a long-time client of Steve Bliss, was determined to leave a lasting legacy for the local library. He wasn’t necessarily interested in receiving income from the donation but wanted to maximize the impact of his gift. Steve recommended a Charitable Lead Trust (CLT). With a CLT, the charity receives income from the trust for a specified period, and then the remaining assets pass to his grandchildren. Steve expertly structured the trust to minimize estate taxes and ensure the library received a substantial and consistent stream of funding for years to come. Mr. Henderson was overjoyed to know his legacy would be one of supporting literacy and education in his community. He felt a tremendous sense of peace knowing his wishes would be carried out exactly as he intended, without burdening his family. He often remarked, “It’s not about what you leave *to* your children, but what you leave *for* them – and for the world.”
Ultimately, incorporating charitable giving into your trust is a powerful way to support the causes you care about while also achieving your estate planning goals. With careful planning and the guidance of an experienced attorney like Steve Bliss, you can create a lasting legacy and make a meaningful difference in the world.
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About Steve Bliss at Escondido Probate Law:
Escondido Probate Law is an experienced probate attorney. The probate process has many steps in in probate proceedings. Beside Probate, estate planning and trust administration is offered at Escondido Probate Law. Our probate attorney will probate the estate. Attorney probate at Escondido Probate Law. A formal probate is required to administer the estate. The probate court may offer an unsupervised probate get a probate attorney. Escondido Probate law will petition to open probate for you. Don’t go through a costly probate call Escondido Probate Attorney Today. Call for estate planning, wills and trusts, probate too. Escondido Probate Law is a great estate lawyer. Affordable Legal Services.
My skills are as follows:
● Probate Law: Efficiently navigate the court process.
● Estate Planning Law: Minimize taxes & distribute assets smoothly.
● Trust Law: Protect your legacy & loved ones with wills & trusts.
● Bankruptcy Law: Knowledgeable guidance helping clients regain financial stability.
● Compassionate & client-focused. We explain things clearly.
● Free consultation.
Services Offered:
estate planning
living trust
revocable living trust
family trust
wills
banckruptcy attorney
Map To Steve Bliss Law in Temecula:
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Address:
Escondido Probate Law720 N Broadway #107, Escondido, CA 92025
(760)884-4044
Feel free to ask Attorney Steve Bliss about: “Are there ways to keep my estate private after I pass away?” Or “What are probate fees and who pays them?” or “Can I name more than one successor trustee? and even: “Can bankruptcy stop foreclosure on my home?” or any other related questions that you may have about his estate planning, probate, and banckruptcy law practice.