Providing a portion of one’s estate to a worthy charity is something to which we can all aspire. One way to accomplish this is to provide a charitable donation through a Trust. A Trust takes possession of assets and distributes them to according to the creator’s wishes, which could include donations to a charity. This may take place at a specific day in the future or upon the Trust maker’s death. If you wish to make a charitable donation before distributing assets to other beneficiaries, an experienced trust attorney could help you establish a Charitable Lead Trust. This tool allows you to prioritize a charity when distributing property. For more information about the formation and purpose of a Charitable Lead Trust in Raleigh, contact our firm today.
Forming a Trust in Raleigh or elsewhere in the state is a relatively simple process. According to North Carolina Revised Statutes § 36C-4-401, forming a Trust only requires the following:
For a Charitable Lead Trust, the beneficiaries will include a charitable organization and at least one other beneficiary. Additionally, the Trust maker should identify the time that the property in the Trust will pass on to beneficiaries, either at a specific date in the future or the time of the maker’s death. In a Charitable Lead Trust, other beneficiaries will only receive their property after the charity receives payments. A local attorney with experience handling Charitable Lead Trusts could further explain the steps involved in forming and utilizing these estate planning tools.
There are other ways of providing funds to a charity besides a Trust. For instance, it is perfectly legal and feasible to donate to charity through a Will. However, Charitable Lead Trusts have significant advantages over other types of testamentary documents. For one, a Trust can transfer property at any time. While a Will only has a legal impact upon a testator’s death, a Trust can move funds to a charity at any date. Additionally, property that moves through a Trust does not need to flow through probate. This can allow charities and other beneficiaries to receive the benefits of the Trust more efficiently. Finally, placing property in a Trust can have immediate benefits for the Trust maker. Once property goes into a Trust, it is no longer in the possession of the maker. This shields the property from taxation or other forms of valuation that may harm a person’s finances. For those considering a Charitable Lead Trust, speaking with a lawyer in Raleigh could be useful in understanding the various benefits of this tool.
Providing funds to a charity is a noble goal for one’s estate. However, choosing the correct way to do so could be key in ensuring that the charity receives the full benefit of the donation and allowing for other beneficiaries to also inherit. Forming a Charitable Lead Trust is one way of achieving these objectives. These Trusts keep property safe from taxation and probate and allow for the assets within them to be distributed at any later date. If you wish to make a donation while still providing for your family’s financial future, contact our firm today to discuss a Charitable Lead Trust in Raleigh.