Charitable giving most often comes from a spirit of altruism, and a person’s desire to do something for the common good. If you think about the causes you care about most, then have you ever considered further the positive effect your giving has on your own life?
The question that must always be asked when giving is whether you wish to make the gift while you are alive, or after your death. Equally important is whether you have considered how to amplify a charitable gift to a favorite charity, church, or organization.
- Restricted vs. Unrestricted Gifts
When donating to a charity, consider whether you want to make an unrestricted or restricted gift. If you decide to make a restricted gift, then be certain to identify the need for which you want your donation used. Or, if you make an unrestricted gift, then be comfortable knowing that your gift can be used in many different, and perhaps unforeseen ways that are beneficial to the charity.
- Life Insurance
Using life insurance to make a gift is a great way to magnify the amount of your donation. Consider purchasing a single premium life insurance policy for $5,000 that has a death benefit of $50,000. Now, your gift of $5,000 can be amplified ten-fold. Another way is to shave off 10% of an existing death benefit to a charity on a life insurance policy already in place.
- Donor Advised Funds
Very popular today is the use of a donor advised fund (DAF). In short, a DAF is a charitable giving vehicle administered by public charities established to manage charitable gifts for families, individuals, and organizations. For example, an individual may wish to donate $50,000 to DAF in which the individual receives a charitable receipt, and with the expectation that over time, the gift amount will grow. The individual can direct which charities the money is to be distributed to with complete privacy, no administrative burdens like one might have with a Charitable Remainder Trust or Unitrust, and with recognition from the charity recipient.
Why do you give?
So, ask yourself, would you like to make a difference? Are you mission-driven or have a personal story that compels you to give to a charity? Perhaps your desire comes from a deeply seated religious belief. Or, maybe you simply want to obtain a tax credit.
Whatever the reason, consider the good that can be done when you make a gift whether when you are alive, or through your estate plan and perhaps your gift will plant a tree giving shade to the next generation.
For more information or if you have questions, please contact our Estate Planning Attorneys at (520) 624-8886 to make an appointment for a one hour no-cost consultation.
IMPORTANT: Neither this blog article nor any information on this website shall be construed as the offering or rendering of any legal advice and does not establish an attorney-client relationship between the reader and Mesch Clark Rothschild (“MCR”) or any attorney at MCR. You should consult with an attorney if you have a specific question regarding your legal issues.
