One option for Colorado residents who are setting up their estate plan is planned giving. Planned giving refers to setting up a charitable donation during a person's lifetime. A planned gift offers a number of advantages including the ability to set up a family tradition of philanthropic giving.
Because the planning occurs while a person is still alive, there is the opportunity to sit down with both the nonprofit and family members to talk about their needs and design the estate plan accordingly. It also takes away the guesswork for family members both about what they will be receiving and the donor's wishes for how assets will be distributed. Advance planning can bring peace of mind to both the donor and family members since the paperwork will all be in place.
Examples of vehicles for planned giving include a charitable remainder trust, charitable gift annuities and an IRA charitable rollover. These may provide tax benefits to the donor while the donor is alive and later remove some of the tax burden on beneficiaries after the donor's death.
Estate planning can be something people tend to skimp on or avoid entirely because it may raise uncomfortable issues. However, not creating an estate plan not only removes the opportunity to help a charity but also can leave headaches for loved ones. If there is no will or any other kind of estate plan, the state decides how assets will be distributed. This can be a long process, and the end result may not resemble the decedent's wishes at all. In addition to a will, a person may want to create other documents as well including trusts and powers of attorney.