FAQ: Charitable Planning

You may think that charitable planning has sunk into nonexistence.  The extremely large (i.e. $11.18 million  in 2018 an) lifetime federal estate exemption has made many question the need for charitable planning.

However, charities are pleased to announce that charitable giving remains strong in the United States.

What are the common ways to participate in charitable giving?

• Lifetime gifts
• Private foundations
• Donor advised funds
• Bequests
• Charitable remainder trusts
• Charitable lead trusts
• Charitable gift annuities
• Deferred payment gift annuities
• Life insurance

In this economy, why do people still make gifts to charity?

• To get an income tax deduction for lifetime gifts
• To get their name on the charitable donation list
• To set an example for their children and grandchildren
• To support their favorite charity
• To make their community a better place to raise their children
• Because they are pressured by their work place, church, or friends
• To avoid capital gains taxes when assets are converted into income producing property
• To avoid having their children inherit too much money
• To allow their children to manage their private foundation and to give their children a sense of purpose

How do I make a bequest?

A bequest is made in your will.  Discuss your charitable goals with your estate planning attorney and he will guide you.

How do I know which charitable planning tool is right for me?

Discuss your charitable planning goals with a qualified and experienced estate planning attorney.  Let him or her know your charitable goals, other estate planning goals, questions, and concerns.

For example, if you need more income now and have highly appreciated assets, a charitable remainder trust may be right for you.

Or, if you have a life insurance policy that you don’t need, naming a charity as the beneficiary of your life insurance may make sense as part of your charitable planning.

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Timothy P. Murphy

Timothy P. Murphy is an estate planning and elder law attorney whose practice emphasizes helping people to build, preserve and pass on their wealth. He works with his clients to accomplish their goals while avoiding unnecessary court proceedings and minimizing or eliminating exposure to death taxes.

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