Cedar Rapids Charitable Bequest Attorneys
Once you have accumulated a certain degree of wealth, it is important to set up an estate plan with your loved ones, but also to share it with the community, such as with a charity or a foundation. This type of estate plan is known as a charitable bequest. A charitable bequest is a good way to leave monetary gifts for philanthropic organizations after your death or before you pass away. This bequest can also be used to reduce the amount of estate taxes that will be paid by your beneficiaries, since these types of donations are 100% deductible.
Charitable bequests can be established in a variety of ways. You can leave cash, real estate, stocks and bonds, or a certain percentage of your estate to an organization of your choosing after your death. With a charitable bequest, you may be able to assist with medical research, protect the environment, or help people who are less fortunate. Through a charitable bequest, you will have complete control of your assets and property until your passing.
If you need assistance with setting up a charitable bequest for your estate, contact the Cedar Rapids estate planning lawyers at Arenson Law Group, PC at (319) 363-8199 today to schedule a consultation.
How a Charitable Bequest Attorney Can Help
For non-profit organizations and charities, planned charitable gifts provide an important source of funding for their work in the community. A team of legal professionals can directly handle your estate administration process by helping you set up charitable bequests in a variety of ways. If complications arise during the administration of an estate, including tax issues or family disputes, an experienced attorney can sort out these complicated issues. In other cases, funds from a charitable bequest might be delayed or distributed inaccurately. A knowledgeable estate planning lawyer can also ensure that your wishes are met by expediting gifts through your charitable bequest and maintaining the impact of your generosity.
Why Choose Us?
The attorneys at the Arenson Law Group, PC have 30 years of experience representing clients in the Cedar Rapids area with estate planning, including setting up charitable bequests on their behalf. Our staff is comprised of Iowa natives, so we have a special connection to the communities that we serve.
When our lawyers help you with your trust administration, you will receive our individualized attention. We understand that charitable bequests are a personal matter because you and your family may have already established a relationship with a foundation or organization. Our goal is to help you continue this relationship by honoring your last wishes. We can attest to our dependability and success as a law firm through our client testimonials. Our numerous awards and recognitions, including an AV-Preeminent Rating from Martindale Hubbell, are further evidence of our success and dedication for our clients.
Types of Charitable Bequests
A charitable bequest, or trust, is an estate plan that provides savings on taxes for the charity, the donor, and any heirs, depending on the type of bequest that is created. There are different types of charitable trusts that allow individuals to donate money or other assets while receiving the tax benefits that come with charitable gifts. These trusts can also simultaneously create a source of income for the estate and for designated beneficiaries of the estate.
Charitable Remainder Trusts (CRT)
A charitable remainder trust provides for a specified distribution to one or more beneficiaries (with at least one beneficiary not being a charity) for life or for a set number of years. With a charitable remainder trust, the remainder interest is paid to the charity designated by the grantor. This type of trust allows you or another beneficiary to receive current income from assets (i.e. stocks or real estate) without having to pay capital gains taxes. The donor will also receive a deduction for income tax for the current value of the gift. In a charitable remainder trust, there are restrictions on how much the trust pays out since remaining assets go to the charity.
A CRT gets a higher interest rate than other trusts. Charitable remainder trusts are recommended for any assets where substantial taxes on high capital gains taxes are paid when the assets are sold. Any income generated can be put in a remainder charitable trust so when the stock is sold, taxes are not due at that time and the entire amount can be reinvested.
Charitable Lead Trusts
Charitable lead trusts are a very different type of trust. With charitable lead trusts, the trust and the remainder of the interest passes on to beneficiaries that are not charitable organizations. The assets will go back to either the grantor or to a designated charity at the end of the term of the trust.
With a lead trust, the tax deduction can be taken for the value of the gift, which is spread out over the course of a certain amount of years. Any income received from the trust is subtracted from the value of the gift. Giving any assets to charitable lead trust also eliminates any taxes imposed on the estate.
The IRS requires all charitable trusts, whether it is a remainder or a lead trust, to be irrevocable. This means that once the assets are turned over to the trustee, you cannot take them back or have control over them anymore. However, you may receive income from the trust for yourself and leave assets to your heirs while also reducing your taxes.
Contact our Charitable Bequest Attorneys Today
Arenson Law Group, PC has several decades of experience helping clients setting up charitable bequests and trusts. Our estate planning lawyers can ensure that your wishes are met by establishing an appropriate trust that meets your needs while providing a legacy for the community. Contact our estate planning lawyers at Arenson Law Group, PC at (319) 363-8199 to schedule a consultation to discuss your charitable giving needs today.
Written by James H. ArensonLast Updated : December 3, 2021