Effective estate planning promotes distinct and multiple goals. One central aim on the mind of many planners is asset protection. Another is family legacy and making a positive and lasting social impact.
We note at the established Bay Area estate planning Law Offices of Berge & Berge that those dual objectives logically invite consideration of one particular planning tool.
Namely, that is the charitable trust, a legal instrument that proves optimal for many planners who are focused on both utility and flexibility.
What are the essentials of a charitable trust?
Like other trusts, a charitable trust is a legal structure spotlighting distinct parties. A trust creator names a trustee to administer the instrument and ensure that its terms and conditions are complied with. Central to a charitable trust is the notion that the trustee will always be focused upon promoting the interests of a named beneficiary.
Notably, a charitable trust can name both charitable and non-charitable beneficiaries, which has led to it sometimes being described as a “split-interest trust.”
Benefits linked with establishment of a charitable trust
An in-depth online overview of the flexibility and benefits conferred by a charitable trust understandably emphasizes the satisfaction that a grantor and loved ones feel from philanthropic giving.
There is much to commend beyond that altruistic aim, though. Notable tax benefits can be realized. A trust can be structured so that its creator receives income. Some charitable trusts pay out money first to a charity for a specified time period and then distribute the remainder to a non-charitable beneficiary. Others reverse that process.
A proven estate planning legal team can provide further information. The above-cited article duly notes that, “The rules for charitable trusts are complex, so it’s important to work with an experienced attorney.”