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Charitable giving for smart estate planning.

Charitable contribution could fulfill your obligation as a human to help another human being and giving help to others provides the fulfillment that we need and we will feel amazing about it which is an addition to the altruistic and goodwill benefit from sharing what we have. Apart from this, most countries provides tax advantages to those individuals who make it a habit to donate to qualified charities.
When you plan for your estate, it is best to plan and consider to donate and give to charity that are deemed qualifies by the IRS (US residents). Many Americans donate to the charities not just to help their favorite foundation but also a strategy to deduct it from their taxes once tax season arrives. Charity giving is also a wise route to maximize planning for your estate, since charitable contributions are 100% deductible from estate taxes.
Most tax payers who does plan for their estates chooses to set a trust that could benefit their preferred charity after a certain period of time. The trust they usually set up is called Charitable remainder trust. Setting up this trust can help your assets gain income within your lifetime and could provide outstanding tax benefits and exemptions not just for you but also for your heirs.

Within the charitable remainder trust, your assets play a rather large role being placed in the trust where assets can be sold by the trustee to set up investment which can generate revenue for a certain period of time you choose to declare.
Once the time period you chose expires the remaining  assets placed in the charitable remainder trust will be given to your choice of charity.

In many cases, donors prefers to take this route because it does generate significant benefit both for him/her and the chosen charity. A charitable remainder trust are either annuity trust or unity trust. Revenue from annuity trust is fixed percentage of the initial fair market value if the assets placed in the trust. On the other hand, unitrust income is fixed percentage of the determined fair market value annually.

To safely determine which trust best suits for you, it is best to talk to your financial consultant. In most cases there are no capital gains taxes on assets transferred to and sold through a charitable trust which also has the potential to generate substantial income to be used by the donor as well as create a revenue generating tax deduction for the donor.

 

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