When creating an estate plan in Arizona, people have many options. For those who have been fortunate in life and have significant assets, they might focus on generosity and giving back to causes that are dear to them. Even those who do not have a large estate could give a portion to charities to help others.
However, this is an area where people are vulnerable to being taken advantage of or could make mistakes that sabotage their goals. Understanding estate planning in general and charitable planning in particular is imperative to ensure their objectives are met. People need to know the state law for charitable planning. It is also wise to have advice with how to structure the plan.
How and why to proceed with charitable planning
The law for charitable trusts is relatively straightforward. It can be crafted to help others by relieving them from poverty, advancing their educational goals, for religious purposes, for scientific purposes, for state or city benefit in helping the community, or to help organizations who focus on these issues.
In some cases, the person might not specify a charitable purpose. When this happens, the court can make the selection. However, it must be consistent with the person’s intentions as much as they can be determined. For example, if the person spent time working with charities for the handicapped, for hospitals or for the benefit of animals in need, then the court could use this as a roadmap to direct the funds.
When creating the trust, the person – known as the settlor – can select a charitable organization to oversee it. Or they can name a trustee to manage it. People who are unsure of whether they should create a charitable trust need to think about their financial situation, their loved ones, what they believe would be the best use of their gifts, and anything else that might be important to them.
A person who has lived a fortunate life and accrued substantial assets could have more than their families will need. They might have smaller families or no heirs at all. Or they could be estranged from their family and want to help others instead. Creating a charitable trust can make good use of their assets. It can also significantly reduce taxes.
It is important to have help with a charitable trust
Regardless of why they are creating this type of trust, they must make sure they are clear in their desires, should go over the kinds of charitable trusts they can use, decide how to proceed, and know how it impacts their estate.
Crafting the plan in such a way that it stands up to scrutiny while achieving what the person set out to do may require comprehensive guidance. For this or any other aspect of estate planning, it is vital to have assistance from the start to have a well-formulated plan that lives up to their intentions.