Giving to Charity Wisely
Charitable giving is a way to help the causes you care about and ensure they’re able to carry on important work. It’s a way to live your values and make a real difference in the lives of others. Financially, it can be a way to lower taxes, ensuring that the most is made of your gift, as well as any assets you’ve preserved for your family and loved ones. This is why it’s important to give to charity wisely and create a charitable giving plan.
Some of the benefits of doing this include cementing your legacy, tax breaks, the ability to continue giving after you pass on, memorializing your family name, and, of course, supporting causes close to your heart. A plan may also allow you to give even more than you thought possible.
One way to set up charitable giving is through a gift annuity. This will allow you to contribute to a non-profit, while also receiving an annual annuity payment form the non-profit’s general fund. It’s a way to receive income while you’re giving. You can also set up a charitable remainder trust, which allows you to receive an income from the trust until you die. At that point, the remainder of the balance in the trust will go to the charity of your choosing. A charitable lead trust, on the other hand, is the opposite. This allows you to contribute to a charity for a number of years, with the balance eventually going to your beneficiaries. You can also leave a bequest, which is essentially an asset you are leaving for the charity you’ve chosen. It could be cash, property, or land, and is usually dictated in your will.
Aside from how to give to charity, there are other things to keep in mind, as well. For instance, it’s important to make sure you’re not contributing to a scam. Make sure to do some research on the charity you’ve decided to give to, and make sure it’s legitimate. Look into how transparent the organization is in terms of where the donations go, and how accountable they are. How much does the CEO make? They may also post minutes to their board meetings, and that can be a good place to get a sense of where an organization is at, in terms of health. It may also be worth speaking with someone in the organization, or requesting a meeting with someone there.
Watch out for tricks like being asked to wire money, give with cash, or purchase gift cards for the organization. These are all things scammers will do. Making your donation by credit card or check is a safer way to go about it.
Usually, up to 50 or 60 percent of your gross adjusted income can be deducted on your taxes for charitable giving, according to the Internal Revenue Service. Giving can positively impact your taxes, and may incentivize you to give more. It’s also good to set up a budget on how much you plan to give to charity. This will let you determine how much you can spend.
Consulting with an experienced estate attorney can help you make a plan for charitable giving for now, and for when you’ve passed on. Depending on the organization, your donations can make a big difference, and having a plan in place will maximize your contributions.
Contact an Attorney Regarding Charitable Giving
If you have any questions regarding how to incorporate charitable giving into your estate plan, it may be a good idea to speak with an estate planning lawyer. The attorneys at The Mattar Firm have years of estate planning experience and would love to schedule you for a consultation! Call 239-222-2222 today!