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When many people sit down to think about how they want to leave their property, of course they think first of family. But many of us also want some of our legacy to go to causes or organizations we hold dear--a church, a food bank, a group that advocates on behalf of people struggling with a particular illness. Americans are a generous people, supporting millions of nonprofit organizations.
The U.S. tax system is designed to support these generous impulses, granting donors tax benefits for giving. If you itemize deductions on your income tax return, you can simply deduct the value of gifts to tax-exempt charitable organizations. There are also more complicated ways to give (and to receive). Charitable gift annuities, for example, are an increasingly popular way to donate to a charity and in return receive regular payments for life; both you and the charity benefit.
Traditional charitable trusts are usually set up by very wealthy individuals concerned about estate tax; they benefit the charity and can also confer a big estate tax break for families. For the other 99.5% of the population, "pooled" charitable trusts can be a good option, providing both a charitable tax deduction and regular income.