Charitable trusts may be ideal for Florida residents who want to ensure that their favorite charities are able to benefit from some of the wealth they have accumulated. Donors can also take advantage of the tax incentives charitable trusts can provide. However, it is important that individuals who want to use the trusts be aware of how they differ from other types of trusts.
One of the main ways charitable trusts differ is that they are not required to name a specific beneficiary. The beneficiary of a charitable trust can be the general public who will benefit economically and socially from the proceeds of the trust. While a specific corporation or individual beneficiary does not have to be named, there must be a description of the purpose that will benefit the public.
Another important distinction of charitable trusts is they can last indefinitely, resulting in the Rule Against Perpetuities not being applicable. The rule is meant to prevent estate plans that limit the use of a property for an inordinate amount of time. However, since public policy is applied differently to the question of allowing charitable purposes that can last in perpetuity, charitable trusts have been given an exception by lawmakers.
The Cy Pres doctrine is also applicable to charitable trusts and allows modifications of the trusts so that they can continue to exist. The doctrine maintains that in situations where there is no provision in a charitable trust document regarding what should occur in changed circumstances, the charitable purpose restriction can be modified by the court.
An attorney who provides estate planning and probate law services may assist clients with determining which types of trusts, such as charitable trusts, to include in their estate plans. A lawyer may assist with drafting provisions for charitable trusts.