A charitable trust is a non-tax exempt trust that lets you donate generously to charity while gaining advantages for yourself. If you want to learn more about charitable trusts, check out this brief overview of charitable trusts and how they are commonly used.

What It Is

Charitable trusts offer you peace of mind while allowing you to donate to a cause you believe in. You can set up a charitable trust to secure a financial benefit for yourself, your heirs, and your favorite charitable organization. They can be set up during your lifetime or after you pass away.

Charitable trusts are somewhat flexible and can be tailored to meet the financial needs and charitable goals of the you, the donor. Many donors set up charitable trusts so they can provide their families with income after they pass away. Providing a stream of income to heirs can give you comfort in knowing that your heirs will not deplete their inheritance in a short amount of time.

How It Works

Donors can fund charitable trusts with various types of assets such as cash, stock, real estate, or business interests. Because charitable trusts include a gift to one or more charitable organizations, you may be able to benefit from a charitable deduction generated when the charitable trust is funded. In some cases, you might also benefit from a reduction in capital gains taxes. Normally, when someone sells an asset (such as stock or real estate) that has increased in value since originally purchased, they must pay a capital gains tax. However, when such an asset is first placed into a charitable trust and then sold, it is possible that no capital gains tax will be owed.

Want to learn more about charitable trusts? Our team of dedicated advisors would love to chat with you to understand your needs and help design the right fit just for you. You can reach us directly at 800-549-3328 or by visiting our “Contact Us” page.