This year’s tax season is just around the corner, which means that it’s time for you to review and plan your financial outlook for the upcoming year. This means anything related to your estate or personal taxes must be taken care of before it’s too late. One common and important issue for people in Nevada is charity. Some people want to ensure that their contribution benefits not only the charity but their families for years to come. One of the best ways to achieve that is through a charitable trust. Here are a few ways to establish such a trust within your estate plan.
Charitable remainder trusts
A charitable remainder trust, or CRT as it is more commonly known, is created for those who want the benefits of not having to pay high amounts of taxes on their income. This option is best for those who are at least age 60 and are getting ready to sell high-value assets such as a company or real estate property. A CRT can help you avoid paying high capital gains taxes.
Charitable lead trusts
When it comes to a CLT, there are two options at your disposal. These include grantor CLT and non-grantor CLT. If you opt in for the grantor CLT, you will be able to claim a deduction for the year of funding, which is equal to the current value of the payments you made. In a non-grantor CLT, you won’t be able to claim that deduction; however, you can still claim an unlimited income tax deduction on what you gave to charity. During your estate planning process, it is important to consult with an accountant, especially when complicated tax laws are involved.
As you can see from the information above, there are a number of ways you can establish charitable trust within your estate plan. Many of the options are beneficial but will require professional help to implement them successfully. Professional accountants and attorneys experienced in estate planning may offer guidance throughout the process.