Options for Donating to Charity Via Your Estate Plan

Options for Donating to Charity Via Your Estate Plan

If you’re interested in using your estate plan to leave behind money to a charity or cause of your choice, there are several ways you can accomplish this.

Here is a quick overview of a few of them.

Charitable trusts

You can name a charity as a beneficiary of a simple revocable or irrevocable trust. There are also special charitable trusts, such as charitable lead trusts and charitable remainder trusts. Charitable lead trusts allow you to make payments to charities during your lifetime, and the remainder of the assets go to you, your spouse or other beneficiary you have after your passing.

Charitable remainder trusts, meanwhile, allow you and/or a beneficiary to receive payments during your life and then provide a portion of the assets to charities of your choosing after your death. The word “remainder” here indicates that the rest of what’s left in the trust upon your death goes to those charities.

Retirement accounts

If you wish, you can name a charitable organization to be the beneficiary of your retirement account. There are a couple benefits of leaving retirement assets to a charity. One, this increases the impact of your bequest, as the charity does not have to pay any income taxes on the donation when it receives the assets. Two, if you have a potential estate tax burden, this will significantly decrease the value of your estate and thus your estate tax burden.

Specific bequests

Finally, you can simply leave lump sum or percentage gifts to charities in your will. Be specific with the bequest, just as you would with a gift to any other beneficiary.

For more information about leaving assets behind to charities in your estate plan, contact an experienced Tampa estate planning lawyer at BaumannKangas Estate Law.