Craig's Corner - Wealth Planning Insights

Friday, August 25, 2017

Incorporating Charitable Giving in Your Estate Plan

How can giving to charity help me to save money in taxes?

Charitable giving can form an essential part of your estate plan.  Charitable giving is not just for the extremely wealthy; rather, charitable giving can be used to reduce the tax obligations of any American.  Consider incorporating charitable giving into your overall estate plan using some of the techniques below to provide for your family and leave a meaningful legacy.

Charitable Contributions in Your Will

One of the simplest ways to incorporate charitable giving into your estate plan is through your will.  You can give an amount predetermined by you to the charity of your choice within your will.  While gifts in your will do not reduce your income taxes, they will reduce your liability for estate tax purposes.  This, in turn, can maximize the final value of your estate for your named heirs.

Donate Your Retirement Account

Another option for charitable giving is to donate your retirement account.  You can designate a charity to be the recipient of your retirement account when you die.  The charity will be exempt from income and estate taxes, allowing it to receive 100 percent of your retirement account’s assets after liquidation.  You can leave your heirs your non-retirement accounts, which do not have the same income tax impact.  

Give During Your Lifetime

You can start giving to charity today to minimize your potential estate taxes in the future.  Amounts that you donate to charity are tax-deductible from your taxable income up to 50 percent of your adjusted gross income.  By giving as much as possible during your lifetime, you can significantly reduce your income tax bill and the size of your estate when it comes to final distribution.  

Using a Donor-Advised Fund

You can open a donor-advised fund as a simple way to give to charity during your life and beyond.  With a tax-deductible contribution, you can start the fund and you can then make grants to any public charity.  You can contribute any types of assets to the fund, including real estate and cash.  With some donations, you could even avoid capital gains taxes.  Contact a charitable giving attorney for more assistance with incorporating giving into your estate plan.  


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S. Craig Stone II of Stone Law Offices, Ltd. serves clients throughout Clark County, Southern NV, Las Vegas, Henderson, Boulder City, North Las Vegas, Summerlin, Carson City, Reno, Washoe County, and Nye County. Also serving clients with asset protection nationwide.

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