Georgia residents who wish to leave a portion of their estate to a charity might want to use a charitable split-interest trust. This type of trust provides an income for the beneficiary as well as supporting a charity. With a charitable remainder trust, there is a set amount of time in which the trust pays the settlor or the beneficiary at least once a year. At the end of the term, which could be a person’s lifetime, the remaining assets go to the charity. With a charitable lead trust, this is done in reverse with the charity receiving distributions for a set period of time and the remaining assets going to the beneficiary at the trust’s end.
There are a number of other advantages to this type of trust. Among these are a reduction of estate and gift taxes as well as income tax deductions. The contributed property’s value is not reduced by capital gains tax when sold by the trust as the trust is tax-exempt.
How a charitable trust is set up depends in part upon a person’s goals. People should consider when they want the charity to get the money, whether they want to be able to change the beneficiary, and whether they want to create income.
Trusts have many uses that people may be unfamiliar with, but an attorney may be able to explain their uses based on a client’s goals. Other types of trusts besides charitable trusts can also achieve multiple aims. For example, a trust may protect assets fro creditors while also managing money for a loved one who may be irresponsible. A trust can be used to keep the details of an estate private and distribute assets more quickly than a will.
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