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How to Go About Incorporating Charitable Giving Into Your Estate Plan

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As attorneys who regularly advise clients in the area of estate planning, we regularly receive a number of questions about charitable giving, especially as it overlaps with estate planning and donating at the time of death. Incorporating charitable giving into your estate plan can become complex under some circumstances. Below, we discuss some of your options if this is of interest to you:

Estate Taxes

Estate taxes is one of the first concerns we hear about from clients; specifically, some are concerned that, if they incorporate charitable giving into estate planning, their heirs might not receive as much. However, it is important to note that your attorney can incorporate charitable giving into your estate strategy such that you actually reduce estate tax liabilities and maximize what is passed onto your heirs.

Beneficiary Designations

Another way to donate to your charity and not address it explicitly in your will is to designate your charity as the beneficiary to your retirement account. Note that, if you decide to do this, the charity will receive 100 percent of the proceeds because they are exempt from estate and income taxes. 

Marketable Securities & Personal Property

Also note that while nearly all charities can also accept marketable securities such as bonds and stocks, trying to leave charities personal property, such as art and collectibles, as well as real property, can get complicated, as many charities are not equipped to accept these types of gifts. It’s also somewhat complicated in terms of the relevant income tax deduction, as that all depends upon your classification, the type of charity receiving the item, and how the organization intends to use it. If you wish to donate a piece  of real property, but also retain the right to occupy that property for a designated term or life, with the property passing to your charity upon death, you will need to work with an attorney who regularly works on these types of estate plans.

Charitable Trusts

Establishing a charitable trust is another option and, if you pursue a split-interest trust, specifically, will also provide you, the donor, with a tax deduction when money is transferred into that trust. It also allows you to control the assets in that trust during your lifetime, like any other trust. 

Incentives

Note that the new tax law could very well reduce incentives to engage in charitable giving every year for the tax benefits, therefore, it might very well be more viable to plan for charitable giving  in  your estate plan instead. This is because the standard deduction is now significantly higher, and therefore, a number of people are no longer able to write off their charitable donations every spring.

Contact Our Florida Estate Planning Attorneys to Find Out More

When it comes to estate planning in Florida, our attorneys provide the very best in legal advice and services. Contact us today at Moran, Sanchy & Associates for a free consultation to find out more.

Resources:

npr.org/2018/12/29/680769165/those-end-of-the-year-charitable-donations-may-not-help-your-tax-bill

ibj.com/articles/72136-una-osili-new-tax-law-could-affect-charitable-giving

forbes.com/sites/catherineschnaubelt/2019/01/09/9-ways-to-gift-your-assets-to-charity/#d51082c6ebeb

voicenews.com/life/estate-planning-and-charitable-giving/article_9f343e11-45c6-563c-9a3e-0cecfd3bcd95.html

https://www.moransanchylaw.com/making-your-florida-estate-plan-doomsday-ready/