Elk Grove Charitable Planning Attorney

Protecting Your Wealth While Supporting the Causes That Matter Most

Over the years, you have worked hard to build your wealth, and after a lifetime of tireless effort, you want to give back to the community. One of the most effective ways to leave a lasting legacy while also supporting philanthropic causes is to consult with an attorney who can help you with charitable planning options.

At Cava & Faulkner, Attorneys at Law, our dedicated legal professionals can assist you with developing comprehensive plans that provide tax benefits, reduce capital gains, while simultaneously allowing you to support charitable organizations.

Contact our Elk Grove, California law office today to schedule a free initial consultation to learn more about your legal options and how we can help.

What are the Most Common Methods Used for Charitable Planning?

Charitable planning allows you to combine your desire to support causes that are personally meaningful to you with financial and tax benefits. Although charitable giving is overseen by federal law, California also has specific tax and probate rules that apply.

Many Californians choose to leave specific charitable bequests in their wills or living trusts or use beneficiary designations that are paid through life insurance policies or IRAs.

Although charitable bequests and beneficiary designations are among the most commonly used methods, there are several other legal strategies for charitable planning. Some of the most common include charitable trusts and donor-advised funds:

Charitable Remainder Trusts (CRT)

A frequently used estate planning tool that allows you to provide ongoing support to a charity while also allowing you to plan for your well-being and your family’s future. A CRT is an irrevocable trust in which the funds provide a steady income to a non-charitable beneficiary, who can be you or a family member, for a specified period. After the period ends, any remaining assets in the trust will go to designated charities.

Charitable Lead Trusts (CLT)

A CLT operates much like a charitable remainder trust, but the charity receives funding for a specified period, after which the remaining trust assets revert to the heirs. One of the most significant advantages of a CLT is that it can provide significant gift tax savings for its beneficiaries.

Donor-Advised Funds (DAF)

For a DAF, you provide financial resources to a sponsoring organization and receive a tax deduction for the full value of the donation in the year that you make it, even if the gift isn’t received until years later. You “advise” the sponsor on which IRS-approved charities should ultimately receive grants when the time comes. The investment grows tax-free over time, which can increase the amount available for charitable purposes later.

How Can I Reduce Taxes with Charitable Gifts?

A key advantage of charitable giving in California is the opportunity to lower your tax burden. Under state law, one way to reduce your tax rate is to donate appreciated assets instead of cash, such as real estate or stocks, to avoid capital gains tax. Per federal guidelines, you can avoid capital gains tax on the appreciated value and also deduct the fair market value.

Depending on your unique circumstances, you may wish to contribute to a donor-advised fund (DAF), which provides an immediate deduction. Charitable remainder trusts are also a viable option that many Californians use to reduce estate and income taxes.

For those who are at least 70½, you can transfer $111,000 annually from your IRA to an IRS-qualified charity, which is excluded from your taxable income, or qualified 501(c)(3) charities. Some state residents choose to “bunch” multiple years of contributions into a single year to exceed the standard deduction, enabling you to itemize and maximize your tax benefits.

While federal law outlines how charitable planning can reduce estate and income taxes, working with an experienced attorney is highly recommended. Only a qualified attorney can guide you through the legal complexities at the intersection of charitable giving and tax planning, and help you determine the most effective path forward.

How Does the New 0.5% AGI Floor Affect Me When Considering Charitable Giving Strategies?

At the beginning of 2026, taxpayers who itemize faced changes in how their charitable deductions are calculated. Under the new law, you will only be allowed to deduct the portion of charitable donations that are for charitable contributions exceeding 0.5% of your adjusted gross income (AGI). The 5% threshold must be met for your charitable gifts to be eligible for a tax deduction.

For example, if your AGI is $100,000, the first $500 of your gift will not count as a deduction, but if your AGI is $ 300,000, the first $1,500 of charitable giving will not be deductible. Instead, only donations exceeding that amount will count toward taxes.

Many attorneys advise clients to “bunch” their charitable donations, giving larger amounts in less frequent intervals. This is a highly effective strategy used to ensure that the gifts surpass the 0.05% threshold, thereby qualifying for the deduction.

What is the Difference Between a Private Foundation and a Donor-Advised Fund (DAF)?

One of the most common questions our attorneys are asked concerns the differences between a private foundation and a donor-advised fund (DAF), and which option is best for their needs.

A private foundation offers individuals maximum control and the benefit of family legacy planning. Even so, it comes at a higher cost and imposes a heavy administrative burden, as they are considered independent legal entities. Conversely, DAFs are more cost-efficient and offer a great degree of privacy while also providing significant tax deductions.

A private foundation can also take considerable time to establish because it requires IRS approval and intricate legal filings at creation. A DAF can usually be established rather quickly without the substantial costs associated with a private foundation.

One unique benefit of a private foundation is that its paid staff may include family members. Although a private foundation must disclose all of its donors, grants, and investments in public tax filings, it also has complete control over decisions. DAFs allow for anonymous giving, but the sponsoring charity has the final say over how assets are distributed.

Do I Ensure the Charity Uses My Gift as Intended?

A common concern among many Californians considering charitable giving is that their gift will not be used as intended. As with any legal matter, your first step should be to consult with an Elk Grove, California, lawyer who can assist you with navigating the charitable giving process.

A charitable planning lawyer understands the legal nuances involved with helping you achieve your philanthropic goals. Creating a written agreement ensures that the charity adheres to your wishes and can face legal action if the funds are misused.

You can also specifically state your intentions in a will or trust. For example, you can clearly articulate how the money or other financial resources must be distributed, such as for a scholarship or for supporting humanitarian causes. If the charity in question does not abide by the terms that you specified, an attorney can take legal action, such as petitioning the probate court to uphold the trust’s original intent.

Why is it Best to hire a Charitable Planning Attorney to Assist Me With My Financial Goals?

For some Californians, creating charitable trusts is a way for them to further their philanthropic objectives. For others, their goal is to reduce estate taxes while also leaving a lasting legacy.

No matter what your intentions may be, hiring a charitable planning attorney is the best way to achieve your long-term goals. When you seek legal assistance, your attorney can help you express your wishes through proper planning.

Some of the most valuable legal services that your attorney can assist you with include:

• Creating custom-tailored legal strategies designed to minimize the state’s high tax burdens, allowing you to give more efficiently.
• Helping to facilitate asset transfers, especially those such as real estate or stocks, to your preferred charities to avoid capital gains tax.
• Strategically structuring philanthropic contributions through charitable remainder trusts, private foundations, or annuities.
• Integrating your objectives through comprehensive estate planning, preventing potential inheritance conflicts.
• Providing legal oversight to ensure charitable donations comply with state and federal standards.

Contact Cava & Faulkner, Attorneys at Law, today to Start Building Your Charitable Giving Strategy

The state and federal laws governing charitable giving can be burdensome to manage without legal assistance. The most practical way to navigate California’s complex laws is to seek legal assistance from a qualified attorney.

Cava & Faulkner, Attorneys at Law, is a California estate planning law firm dedicated to helping clients with their philanthropic goals. When you come to us for help, our team will thoroughly assess your objectives and develop customized legal strategies tailored to your needs.

If you have questions about our legal services or are ready to get started planning your giving strategy, contact our law office at (916) 831-7565 to schedule a free consultation.