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Charitable Giving: Dos and Don’ts During the Holidays

The holiday season is a time for giving thanks and giving back, and this is reflected in the fact that the last two months of the year are when most charitable giving occurs. 

As you age, it is natural to want to give more of your assets away to people and organizations that are meaningful to you. On a small scale, in nearly every case, nothing prevents you from doing this or suggests it is a bad idea.

Dangers of Acts of Charity During the Holidays

Sharing your wealth with others may seem like a harmless activity. However, there are risks involved for those who give gifts of all sizes. 

For those looking to protect their assets through an estate plan, charitable giving at any time of the year should be planned carefully and done in cooperation with a charitable giving attorney. Failing to do so can jeopardize your assets and endanger the goals of your estate plan.

Dos and Don’ts of Charitable Giving

Before you hand over a check to an agency or give your credit card number to an organization, consider the following dos and don’ts when planning your charitable giving:

Do Consider Charitable Giving as Part of Your Estate Plan

Your estate plan is all about an orderly disposition of your assets upon your passing. Giving gifts to those people and causes that are meaningful and significant to you is one way to achieve this goal. 

If you had planned to give an organization a specific amount of money through your estate plan and you make a contribution now, consider whether that gift warrants a reduction in the amount of assets they receive through your estate plan.

Don’t Forget the Limitations on Gifts

You can give gifts to others tax-free, up to a point. After that point, the recipients can be liable for paying taxes on the gift. So long as you give less than $17,000 per year and do not gift more than $12.92 million in your lifetime, you will not need to worry about the gift tax needing to be paid.

Do Follow Proper Procedure When Making a Gift

When you do contribute to a person or organization, make sure there is a paper trail showing that the gift was made and by whom. If the gift came out of a trust, this means getting the trustee’s approval, if needed, and having them make the payment on your behalf. 

Even if you are the trustee of your own trust, make the distribution as you would any other distribution from the trust without mixing trust assets with your own personal assets.

Don’t Turn Over Access to Your Funds

No matter the organization or how well you know those involved, protect the assets that you have worked hard to accumulate, and do not give out sensitive information to anyone in person or over the phone. This includes giving someone over the phone your full Social Security number, account information, passwords, or other sensitive data. 

If you want to address making a recurring gift to an organization, visit with your charitable giving attorney about how best to set that up.

How an Orange County Estate Planning Lawyer Can Help With Your Charitable Giving

Taking shortcuts with your estate and its assets is a surefire way to risk losing some or all of it. While charitable giving in your later years is laudable and should be done, it should also be done properly to preserve the value and integrity of your assets and overall estate plan. Reach out to OC Wills and Trusts for help.

Brian Chew, the managing partner of OC Wills & Trust Attorneys, has extensive experience in the areas of estate planning, asset protection planning, business succession planning, long-term care planning, and veterans’ benefits. By devoting his practice to estate planning matters, he has founded a firm that strives to provide exceptional service to their clients by working closely with individuals and their families to create comprehensive and customized estate plans. For the past twenty five years, Brian has served thousands of clients in the matters of estate planning, wills and trusts. If you have any questions about this article, you can reach Brian Chew here.