Charitable remainder trust and charitable bailout

Apart from donating cash and property charitable contributions as discussed earlier, you can also use charitable remainder trust and charitable bailout to your advantage to get the charitable contribution tax deduction. In the case of a charitable remainder trust, you also get income for life. In the case of charitable bailout, you get more than tax savings benefits. 

Charitable Remainder Trust

Charitable Remainder Trust or CRT allows you a charitable deduction for the cash or property you put into charitable remainder trust for your favorite charity, but you receive the trust income for life. Almost all colleges and large charities have a fund raising department that will be delighted to help you set up the charitable remainder trust.

Charitable Bailout

Charitable Bailout  works only for those who own a closely held corporation. If you fit that description, you can do a charitable bailout.

What is a charitable bailout?

In a charitable bailout, you donate some of the stock of your corporation that you own to your favorite charity. Then, have your corporation use corporate cash to buy the stock back from the charity. The charity has money, you have the charitable tax deduction, and you did not have to take additional (taxable) salary or dividends from the corporation. Of course, you have a little less of the stock, but if you and your family are the only owners of the corporation 's stock, that probably is of little consequence.