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Many people like the idea of leaving bequests to favorite charities in their wills. But instead of leaving money to a charity in your will, you can put that money into a charitable remainder trust and collect income while you are still alive. Charitable remainder trusts have many other advantages, including reducing your income and estate taxes and diversifying your assets.
A charitable remainder trust is an irrevocable trust that provides you (and possibly your spouse) with income for life. You place assets into the trust and during your lifetime you receive a set percentage from the trust. When you die, the remainder in the trust goes to the charity (or charities) of your choice
A charitable remainder trust has many benefits:
The downside of a charitable remainder trust is that it is irrevocable, meaning once you create the trust, you can't cancel it. While you can't revoke the trust, you may have the ability to change the beneficiary if you decide to give to a different charity. You may also serve as trustee, giving you control over how the trust assets are invested. In addition, note that any income you receive from the trust will be subject to income taxes.
To find out if a charitable remainder trust is right for you, talk to a qualified elder law attorney. To find an attorney near you, go here: https://www.elderlawanswers.com/elder-law-attorneys.
For more information about trusts, click here.