Tips When Leaving Money or Assets to Charity

When creating an estate plan, many people, generously, want to provide some money or assets to charity. But just saying you want to leave money to a charity and picking that charity isn’t enough. That’s because there are a number of different ways to leave money to a charity, and thus, when creating an estate plan, you may want to give thought to the best way to do that.

Lifetime Gifts

You do not have to wait until you are gone, to leave money to a charity. You can establish a lifetime gift to a charity, but because of the tax implications in doing so when you are still alive, you shouldn’t do this unless you’ve consulted with a tax professional.

In Your Will

Of course, the most common way to leave assets to a charity is through your will. Remember however, that wills go through probate, and probate is a public process, so if you’re concerned about privacy, a will may not be the best way to go.

Another consideration is that wills are subject to challenges. There are ways to avoid that, but it’s another reason to make sure, if you are leaving property to a charity in your will, that you speak to your estate planning or probate attorney, and preferably, also to your family.

Charitable Trusts

There is also the option of starting a charitable trust which, unlike wills, doesn’t go through the probate process, and thus, also has the added benefit of being much more private.

One way to do this is through what is known as a charitable remainder trust or CRT. This is a trust that makes distributions to any human person you designate (which can be you), and then on your death, anything remaining in the trust, goes to your designated charity.

There is also the option of a trust that only pays out the interest from the trust assets to the charity. The principal is paid to whomever you designate, however and on whatever terms that you designate when you establish the trust.

Some trusts allow you to make periodic donations to the trust even after its establishment which, if done correctly, can help minimize estate or gift taxes.

Get to Know the Charity

However you do it, it is always best to speak with the charity beforehand. The charity may have numerous divisions, branches, or sectors, and you may only want to leave your trust money to one of them. For example, if it is a dog rescue charity, maybe you only want your gift to go towards veterinary care, or to help offset adoption fees, or to help pay for staff.

Remember that you don’t have to only leave money to charity, Your personal items can be left as well. In some cases, personal property, which relatives may not want or need, can be a valuable gift to the right charity.

If you have a probate or estate planning issue, we can help. Call the West Palm Beach probate lawyers at The Law Offices of Larry E. Bray today for help with your probate law case.

Sources:

insightmcc.org/blog/how-to-leave-money-to-a-charity-in-your-estate-plan-3-main-methods.html

ccf-mn.org/best-assets-gift-to-charity/