If you are a Kansas resident for whom your church is one of the most important aspects of your life, you may wish to consider setting up a charitable trust to benefit it now and/or in the future. While you may not be a wealthy person who can afford to give much more than your tithe, you have the flexibility to set up your charitable trust so that it benefits not only your church, but also you as well.
The beauty of a charitable trust is that it gives you significant control over the assets you place in it and the flexibility of deciding when, how and to whom the income from those assets, plus the assets themselves, are distributed. In addition, such a trust lets you accomplish four separate goals:
- Charitable giving
- Wealth preservation
- Estate planning
- Tax management
There are two types of charitable trusts: a lead trust and a remainder trust. Which type is best for you and your church depends on what you wish to accomplish and the way in which you wish to accomplish it.
Charitable lead trust
If you wish to start benefitting your church now, a charitable lead trust probably is your best option. In this type of trust, the interest and other income from your trust assets go to your church for the number of years you designate or for an unspecified period of time such as your lifetime. Depending on which option you choose, your trust ends at the end of the designated period or when you die, and its remaining assets then go to your church or to another beneficiary of your choice.
Charitable remainder trust
If, on the other hand, you need income yourself, a charitable remainder trust probably is your best option. Again you can choose how long this trust will last, either for a specified period of years or until you die. In this type of trust, however, you receive the interest and other income from your trust assets and your church receives the remaining assets when the trust ends or at the time of your death.
Funding your trust
Keep in mind that your charitable trust is only the vehicle by which you and your church benefit. You must place sufficient income-producing assets in it so that your trustee can disburse them to you or your church each year. Most people put such things as the following into their charitable trusts:
- Life insurance policies
- Rental property
- Certificates of deposit
- Treasury bills
A charitable trust can be exactly the solution you are looking for to help not only your church but also you and your family for many years to come.