What Are Benefits of Establishing a Charitable Trust?

When creating an estate plan, one attractive option to consider is the creation of a charitable trust. A charitable trust is not only a way to leave a legacy and contribute through one’s estate to meaningful causes but also an important tax management and money-saving vehicle for your family. An Illinois trusted advisor can help you consider whether this estate planning tool is right for your family’s future. 

What Is an Illinois Charitable Trust?

A charitable trust is an element of an estate plan that gives the grantor an opportunity to contribute to charitable organizations through a vehicle with tax advantages. Charitable trusts are often used by high-net-worth individuals to fund organizations such as nonprofits, hospitals, and scholarships.

What Are Some Things to Think About When Setting Up an Illinois Charitable Trust?

Before setting up an Illinois charitable trust, it is important to give some thought to the details of the trust, including whether the charity beneficiary of the trust aligns with your estate planning goals, the assets that you wish to place in the trust, and the type of trust you wish to create. 

Illinois law offers several options for types of charitable trusts. These include revocable trusts, which can be modified during a grantor’s lifetime, and irrevocable trusts, which may not be altered once established. Another option is to structure a charitable trust as a testamentary trust, which only comes into effect once the grantor passes away. 

What are the Benefits of Including an Illinois Charitable Trust in Your Estate Plan?

There are many benefits to creating an Illinois charitable trust:

• Tax benefits: Charitable trusts can provide significant tax deductions to a donor’s taxable income and estate taxes. They allow donors to put in highly appreciated assets without incurring capital gains taxes. Estates with very large assets may also benefit from an estate tax deduction upon the grantor’s death. The trusts also offer an income tax deduction.
• Anonymity for charitable donations: Charitable trusts have the potential to grant anonymity to charitable donors who wish to remain anonymous. 
• Philanthropy: Charitable trusts allow grantors to ensure their legacy lives on by contributing to worthy causes with an estate plan. 

Contact Our Naperville, IL Estate Planning Lawyer

As you consider your estate plan, a charitable trust can provide a great way to safeguard your legacy while taking advantage of significant tax benefits. Due to the intricacies of creating a charitable trust that will fulfill the goals of your estate plan, we recommend hiring an experienced attorney who has handled complex estate plans and charitable trusts. Our team has experience with charitable trusts and high-net-worth estate planning, and we can help ensure that your estate plan reflects your giving goals and current circumstances.  Reach out to our Naperville, IL estate planning attorney at the Gierach law firm today by calling 630-228-9413 to schedule a consultation and take the next step in securing your legacy.