Many people feel a great sense of satisfaction in charitable giving. After all, many people have causes they feel passionately about and want to support. One way that people can give to a favorite charity is through their estate plan. There are a variety of ways to accomplish this.
One way to give to a favorite charity through estate planning is by including a bequest to a charity in your will. Another way to make a charitable donation is by naming a charity as the beneficiary on your retirement accounts. Charitable trusts are another way to pass your assets on to a favorite charity.
However, charitable giving can be complex. When giving to a charity through a will there could be tax consequences that need to be addressed. Conversely, charities are generally tax exempt, so a charity named as a beneficiary in a retirement account will likely receive the full amount of the account upon the account holder’s death. In addition, there are different types of charitable trusts to choose from that dictate who has control of the trust and who can take advantage of tax deductions for funds transferred to the trust.
Because there are so many options when it comes to charitable giving and estate planning, it is important for people who wish to donate to a favorite charity to understand which option best meets their wishes. While wills may be useful to some, trusts may be useful to others. No two people have the exact same circumstances, so a boilerplate estate plan may not be useful. Instead, those considering giving to a favorite charity through estate planning often get more information about estate planning and administration to ensure that their wishes with regards to their estate are met.