Answer: Federal And State Tax Laws Encourage Charitable Giving. Consider Doing One Or More Of The Following:
- Include a charitable organization in your Will. This can be via a cash bequest (specific dollar amount) or perhaps a fractional share of your estate. You can make a restricted gift, for example, to the chemistry department of a university for research, Or, instead, you can let the charity decide how best to use your gift. You pay nothing while alive. Your estate pays and gets an income tax deduction after you pass away.
- Donate stock. You can avoid paying income tax if you gift stock directly to a designated charity instead of selling the stock and paying in cash. The charity will sell the stock and receive the cash free of income tax.
- Make a Qualified Charitable Distribution. Instead of paying income tax on the annual required minimum distributions from your IRA, direct the IRA custodian to make the distribution directly to your favored charity. You pay no tax and neither does the charity.
- Create a Trust. Establish a trust fund, either for now, or for after you pass away and obtain an income tax deduction. You decide how, when, and for what purposes the trust fund will benefit the charity. This will be your legacy that continues long after you are gone.
Before making your gift, confirm that your chosen charitable organization qualifies under the Internal Revenue Code. Also make sure your charity provides you with a receipt.
If you want to learn more about how you can benefit both yourself and one or more of your preferred charities through your estate and tax planning, contact the lawyers at Vasiliadis Pappas Associates LLC. We can help!
