Individual Retirement Arrangements and Estate Plan
If you have assets or money that you will leave behind when you pass away, you need to decide who will get them and make sure those arrangements are a part of your estate plan. An estate planning attorney in Orange County can help you create an estate plan so you decide who gets what and can have a final say over your belongings.
An Orange County estate planning attorney can also help you set aside your retirement account so that money can go to a charity and also your children.
Is It Possible To Donate To Charity And Your Children?
Yes, many people want to leave money from their individual retirement to their children so they know they are taken care of and get the majority of the money they earned.
They may also have a charity that they are passionate about and want to set aside a certain amount for donations. One option is to choose a CRUT. It is an irrevocable trust that provides the beneficiaries with income for a set number of years or for life instead of a traditional IRA.
Your children or beneficiaries receive a specific amount of money each year from the CRUT and when they pass away, the money that is left is donated to the charity of your choice.
Reasons To Donate To Charity
You may be wondering if a CRUT is a right option. There are many reasons why you may want to choose to leave the remainder of your retirement account to a charity.
Here are a few to keep in mind before making your choice:
- Reduce Taxes
When you leave a lot of money for your family, they will have to pay taxes for it. Even if the money is in an IRA, eventually they will have to withdraw it and pay the taxes.
By choosing to donate money to charity, you reduce the amount of taxes that need to be paid which can help save your family a lot of time and fees. If you are worried that your family will have to pay back a lot of their inheritance in taxes, you may want to choose to donate some of your money to charity.
- Help A Good Cause
One of the most obvious reasons a person may choose to leave their money to a charity as well as their children is because they believe in the cause that the charity represents.
Many people donate to charity during their lifetime and are passionate about the work that charity does and the good things it makes happen. It makes sense that you may want to donate money after your death so the charity has a large amount of money to put towards their projects and goals.
- Create A Legacy
If you want to leave something behind for your family besides just money, it can be a good idea to leave a legacy of giving.
When you choose to leave money to a charity and your family learns of it, it will motivate them to donate too. In fact, many families donate to charity in the name of their deceased loved ones as a way to keep their memory alive.
If you are hoping to get your family interested in the same charities you donated to while you were alive, this can be a good way to do that.
How To Choose A Charity
If you don’t already have a charity that you donate to and you may be looking to find one, you may want to choose your charity carefully and make sure it is one that you are passionate about and that is deserving of your estate or CRUT.
Here are some things to keep in mind when choosing the right charity.
You should be aware of the charity’s mission so you can determine if it lines up with your morals and passions. The charity you choose should mean something to you so you can feel good that you are leaving money to an organization that will deal with things that you care about.
The size of the charity will determine how much it can accomplish and this can help you decide if you want to leave your money to it. You may prefer a smaller charity that does a lot of things locally or a larger charity that will use your money to make changes all over the world.
Consider Multiple Charities
You don’t have to settle for one charity alone, you can choose to spread your money across several ones. If you can’t decide which one is more deserving or if you are involved with more than one charity now and want to leave them all a portion of your estate or retirement, you can make those plans with the help of a living trust attorney in Orange county.
How to Set Up An Estate Plan to Donate to Charity and Your Children
If you are planning to set up a CRUT that will allow you to leave your personal retirement to your children and the charity or charities of your choice, be sure to make an appointment with an Orange County trust attorney who will work with you to make sure the money you leave behind goes where you want it to.
It is possible to leave money to both your children and a charity, and an experienced Orange County estate planning lawyer can help you do it. If you are ready to start planning for your estate, be sure to call Thomas McKenzie Law today.