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If you have already created an estate plan, you’ve likely set up your wills, trusts, and powers of attorney. Most people don’t need additional documents and can rely on these simple tools to protect their estate and legacy after death. However, if you have a particularly large or complex estate, it may be in your best interest to look into advanced estate planning.
Advanced estate planning is a set of tools that take advantage of tax laws to minimize your tax liability while maximizing the ability to achieve your financial goals. There are many advanced estate planning tools available, and not all of them may be needed for your particular estate. If you would like to look into advanced estate planning, contact The Singh Law Firm today. Our experienced team will review your estate and make recommendations based on your goals and your current finances. To receive a free consultation, call us today at 510-742-9500.
When creating your estate plan, you can use specific estate planning tools to give money to charity while preserving your wealth. Charitable contributions are deducted from your income taxes, and in most cases, they are not subject to gift taxes or estate taxes. There are several ways you can donate money to charity while still preserving enough wealth to pass down to your family.
Common estate planning tools for this method include:
A charitable remainder trust is created while you are still alive, and either you or the named beneficiaries receive benefits from it. Once the beneficial period is over, anything left in that trust gets donated to charity. You will receive a tax deduction for the present value of the remainder, and the assets in the trust will not be included in your taxable estate.
A charitable lead trust is created and pays any current income to charity. Any balance remaining after a certain period is then paid out to your named beneficiaries. Charitable lead trusts are irrevocable, meaning they are not part of your estate and cannot be taxed. However, they may be subject to a gift tax.
An annuity contract allows you to give assets to a charity as a gift. In turn, the charity agrees to pay you a certain amount of money for a set period of time. An annuity is beneficial because it removes assets from your estate, lowering your overall tax liability.
Donor advised funds, also called DAFs, allow you to donate money to charity while keeping it in a separate account. You or others you designate can advise the charity on how the funds should be used. This removes the money from your estate while still giving you some control over its use.
The information contained here has been prepared for informational purpose only and not legal advice. The use of this website and the sending or receipt of information does not create an attorney-client relationship between you and Singh Law Firm.
Advanced Estate Planning