Charitable Giving As Part of Your Estate Plan

Many people in Illinois like to make a habit of donating to charitable causes. This allows you to enjoy the feeling that comes from helping others, and giving back to charities also helps reduce tax expenses for you and your beneficiaries.

This blog sets out to give you a few tips to help you benefit from making charitable giving a part of your estate plan.

You can choose to establish a trust and make a charity one of your beneficiaries. This can be done with either a revocable or irrevocable trust.

Another option is to set up a charitable lead trust, which allows you to donate to a charity while protecting any remaining assets for your beneficiaries. A charitable lead trust can also help you reduce capital gains taxes by storing appreciated assets, such as stocks or properties.

Donor-Advised Funds

Another way to donate to charitable causes is through a donor-advised fund. These funds are usually managed by financial institutions, allowing you to donate to charities while minimizing tax-related expenses. This option is good for those who want help with estate planning and making charitable donations.

Retirement Accounts

You can also donate to a charity through a retirement account. Retirement accounts are great for donors, because charities that receive money from these accounts won’t pay taxes on what gets donated. It is important to note that married individuals wanting to make charitable donations their beneficiaries might need to receive written consent from their spouses before this can happen.

Ultimately, there are several beneficial ways to make charitable giving a part of your estate plan. Consider establishing one or more of the above accounts to reduce your tax expenses and maximize how much you can give back to charitable causes.

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