209.835.9592
Call for a Free Consultation !

Common Questions About Charitable Giving After Death

Charitable giving after death is a gracious way to make a difference with your legacy. There are multiple ways to structure your postmortem giving, and some of them can be advantageous to your other beneficiaries, if applicable. A lawyer located in Tracy or Manteca can counsel you as to the most beneficial way to structure your estate plan to maximize charitable donations.

Can’t I just leave assets to a charity in my will?

Absolutely, you can, but it may be more advantageous to structure your giving differently. For instance, if you have appreciated assets, you could transfer them to a charitable remainder trust. If you would like to give to multiple charities, it may be best to create a private foundation. The manager of the foundation will make individual grants to various charities, individuals, or scholarships. One of the benefits of using an alternative means of distributing your assets, other than your will, is that your surviving family members can contest your will. If you’ve decided to disinherit your family, there may be an increased risk of a contested will.

Can charitable giving reduce my estate taxes?

Yes, if it’s done properly. Your estate planning attorney may recommend leaving your retirement assets to charities. These assets tend to be taxed the most after death. Structuring your giving so that your retirement assets are directly transferred to the charity will give your estate a federal estate tax charitable deduction. This lessens estate taxes for your beneficiaries. Plus, the charity won’t be required to pay taxes on your gift.

Can I donate my life insurance benefits to a charity?

Yes, you can. This is one of the simplest methods of charitable giving after death, and surviving family members cannot contest the transfer of assets. The money is paid directly to the charity, bypassing probate. However, there may be a better way to give your life insurance policy to your favorite cause. Look for a life insurance carrier with optional charitable giving riders. You can attach the rider to your policy, and after you die, the rider increases the face value of the benefits. Usually, attaching a rider doesn’t increase fees or premiums, although there may be maximum thresholds on the total gift amount.
Categories: Attorney