Charitable Planning in New Jersey
Haddon Heights Estate Planning Lawyer
Charitable planning allows you to provide funds to a charity and may provide you with significant tax advantages. One of the most common ways to donate to charity is through a charitable remainder trust. This type of trust requires you to create a trust, put the property you wish to donate into the trust, and select an IRS-approved charity to serve as trustee of the trust. Using this type of trust, the charity pays a portion of the income generated by the property to you or someone else you select for a specified number of years or until the end of your life.
Tax Benefits of Charitable Planning
There are a variety of tax advantages available through charitable trusts, including advantages in income tax, estate tax and capital gains tax, and a Haddon Heights estate planning attorney can help determine your options. You can spread your tax deduction, which is based on the value of your charitable gift, over a period of five years. Because the trust property is no longer part of your estate, it will not be subject to federal estate tax. If you have property that is worth significantly more now than when you purchased it, it may be beneficial to place it in a trust because charities do not have to pay capital gains taxes.
Receiving Income from the Trusts
There are two basic ways to receive income from a charitable trust. You can set your trust to pay you a certain amount every year. The amount cannot be altered and you must choose your payment amount carefully, as high payments may eat away at your trust funds, or your charity of choice may reject your gift. Another option is to accept a percentage of the trust, which can help with concerns of inflation. You must receive at least 5% of the value of the trust each year under the Internal Revenue Service rules.
The Benefits of Enlisting a Haddon Heights Estate Planning Attorney
If you are interested in planning for your future and assisting others through a charitable organization, a charitable trust may be extremely beneficial to you. With more than 30 years of experience, my firm can assist you in choosing the best type of trust for your needs. As an experienced Haddon Heights estate planning attorney, I pride myself on taking the time to understand my clients' situations and desires for their future and preparing a detailed plan for their families. After carefully learning about their wishes and desires for their future, I offer them practical and personalized estate planning advice. Because of my excellent service to clients and abilities as an estate planning lawyer, my firm has earned an BV Distinguished® Rating by Martindale-Hubbell® and has been honored by inclusion in Super Lawyers® Business Edition. If you would like to learn more about charitable planning, complete a
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