There are a myriad of options for creating a comprehensive estate plan. Many people have the desire to gift part or all of their estate to a charity when they pass away. It is a selfless choice and can make a huge impact to the organization that receives it. Many families here in Georgia likely have questions about exactly how a charitable donation fits into estate planning. Experts have a few recommendations.
One of the simplest options available is to list the donation as a provision of a will. Some donors worry that the estate tax rate could mean that beneficiaries won’t receive as much of an inheritance as the donor wishes. Making a contribution to a chosen charity can lower the donor’s tax liability.
Another way is for the donor to gift his or her retirement account to the chosen charity. This is done by having the donor list the charity as the beneficiary for the account. The charity will receive the full value of the account because it is not required to pay estate or income taxes.
The last recommended method is to put funds into a charitable trust. A split-interest trust ensures that the charity receives the amount of the trust upon the donor’s death. The donor will keep control of the assets until then, and he or she will also get any tax deductions that occur when money is put into the trust.
Whatever method a donor chooses, the important thing is that the charity in question receives the funds. Passing away without a comprehensive estate plan lowers the likelihood that this will happen the way the donor may hope. Those here in Georgia who have questions about estate planning may want to consult an attorney with extensive experience in estate planning. It may be the best way to ensure that the final wishes of the potential donor are honored.