Jesus has called each of us to a life of discipleship, which is expressed in many ways, including a commitment to lifelong, comprehensive Christian stewardship.

At its best, that begins with a tithe on a child’s allowance, followed by a lifetime of faithful proportionate giving capped by an estate plan that includes the church in the final distribution of lifetime assets.

Tom Wilkinson

Tom Wilkinson

To put it simply, stewardship is an integral aspect of our lifelong commitment to following God’s call on our lives.

Some basic principles of estate planning put each of us on the right path toward that stewardship ideal:

    • Everyone should have a will or living trust that designates how one’s assets will be distributed at death. Amazingly, about half of all Americans die without a will, which is technically a misstatement since each U.S. state has a standard will that is applied to those who die “intestate.” Sounds like a disease, doesn’t it? And in the final analysis, it is. When a person dies without a will, the probate court system often consumes many of the assets of the deceased. That’s why it’s so much better for each of us to prepare for the inevitable by having a will or living trust.
    • We often think of having a will as important only for old guys like me, but it is even more critical for families with minor children living at home since a will addresses guardianship issues should both parents die.
    • A comprehensive estate plan includes the granting of durable power of attorney and healthcare surrogacy, a living will, healthcare directives, and other end-of-life issues.
    • Committed Christians who follow a discipline of lifelong stewardship should consider an estate plan that includes their church and other important charitable institutions that have shaped and influenced their lives.

Among the many planned giving options available to United Methodists, the charitable trust is one of the most versatile. Here’s how it works:

  • The donor, or grantor, transfers assets — cash, securities, real estate, partnerships, others — to a charitable trust, which must meet certain IRS requirements regarding distribution of assets to charitable causes.
  • When the trust is established, a trustee is named to manage the affairs of the trust. The trustee may be the grantor; a third party, such as an attorney or financial advisor; or an institution, such as the Florida United Methodist Foundation.
  • Potential tax and income benefits accrue to the grantor, while at the same time creating a benefit for the grantor’s church or qualified charities.

There are two broad categories of charitable trusts: remainder trusts (CRTs) and lead trusts (CLTs), each of which may be appropriate for a donor, depending on his or her financial
circumstances and charitable objectives.

A CRT provides tax and income benefits to the donor or the donor’s family for the duration of the trust. The church and/or other qualified charities then receive the remainder of the trust
assets when the trust terminates, either at the death of the grantor or after a term of years.

A CLT is essentially the reverse. During the term of the trust, the trust distributes income to the church and/or qualified charities and at the termination of the trust, the trust assets revert to the donor or family.

I’ll examine CRTs and CLTs in more detail in future blogs. In the meantime, please contact me at twilkinson@fumf.org or 866-363-9673, ext. 7105, for more information. And for a complete guide to end of life planning, email foundation@fumf.org.

The foundation strongly urges individuals to consult with their attorney or other professional advisors before establishing a trust or other estate planning vehicle.

* Wilkinson is the foundation’s vice president of church relations and new business.

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