Legacy planning is a more comprehensive and complete form of estate planning. When you craft your legacy, you carefully consider the way that you want to be remembered after you are gone.
If you are in a position to do so, you may want to be known for your generosity. Indeed, there are a number of different ways that you can provide for charitable causes and institutions that are meaningful to you when you devise your legacy plan.
If you have philanthropic aims, you may want to consider the creation of a private foundation. There are those who assume that a private foundation is out of reach, because they equate foundations with names like Ford, Rockefeller, and Gates.
While it is true that billionaires often start them, when you look into the facts, you find that most of the foundations in the United States are funded with less than $1 million. Clearly, if you establish a foundation, your name will be attached to good works. At the same time, you can gain tax advantages as a small reward for your generosity.
There are charitable trusts that can also be part of your legacy plan, and once again, there can be tax advantages gained along with the personal satisfaction. With a charitable remainder trust, you receive annuity payments throughout the term of the trust. After the term expires, a charitable beneficiary would assume ownership of the remainder, which must be at least 10 percent of the original value of the trust.
There are also charitable lead trusts, and they work in the reverse manner. A charitable beneficiary receives payments throughout the term of the trust, and a non-charitable beneficiary would assume ownership of any remainder that may exist after the expiration of the term.
Under certain circumstances, a charitable lead trust can be very valuable if you are exposed to the federal estate tax. This tax is applicable on asset transfers that exceed $11.4 million. To provide a brief explanation, the IRS calculates anticipated interest when the trust is established. If the assets in the trust perform better than the IRS estimate, the non-charitable beneficiary could potentially assume ownership of the remainder free of taxation.
Donor Advised Funds
Donor advised funds are an option as well if you want to set aside assets for the benefit of charitable causes. You make one contribution, and you can ultimately advise the fund to use the resources to support multiple different charities.
Learn More About Legacy Planning
We have stayed focused on the matter of philanthropy in this particular post, and it can indeed be an extremely meaningful act, but it is just one part of a comprehensive legacy plan. Our firm has prepared a very informative, in-depth report that contains everything that you need to know about the legacy planning process.
This paper is being offered free of charge at the present time, so you can really ratchet up your knowledge without putting out a single cent. You can visit our legacy planning report page to learn more right now. Plus, there are reports in our library that cover many different elder law and estate planning topics, and you are welcome to access any of them at any time.
Check Out Our Seminar Schedule
In addition to the content that we have on this website, our attorneys make a concerted effort to get out into the community to provide information to our neighbors in person. That’s right, we offer free seminars on an ongoing basis, and they cover a lot of ground in a simple, understandable way.
Some of the seminars are held in our offices in Essex Junction, and we also get out into other nearby cities, so you should be able to find a date that is convenient for you. To get all the details and obtain registration information, cruise over to our seminar schedule page.
Our Firm Can Help!
If you would like to discuss a legacy plan that includes charitable giving with a licensed professional, our firm can help. You can call us at 802-879-7133 to schedule and appointment, and you can alternately send us a message through our contact page.
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