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Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 10097
Experience:  Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
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I need to set up an a medical trust account that would be tax

Customer Question

I need to set up an a medical trust account that would be tax free and free of leins etc... ALSO-- I have a friend who wants to do a planned monthly giving -- can this done so that she can write it off? not quite a gift?
Submitted: 1 year ago.
Category: Tax
Expert:  Lane replied 1 year ago.
Hi,.Are you possibly thinking of a special needs trust? These trusts can be used to retain the ability of one with a disability, who has, or is gifted, assets, to get government assistance, even though, NORMALLY, those assets would disqualify the person..There are also OTHER types of Irrevocable trusts, but they pay their OWN taxes, UNLES they have charitable beneficiaries..Can you explain a little more about what you mean by tax free?.Byt the way ANY irrevocable trust can provide the creditor pretection you mention..Let me know more and we can go from there...Lane
Expert:  Lane replied 1 year ago.
Re: the planned monthly giving, You can deduct your contributions only if you make them to a qualified organization. Most organizations, other than churches and governments, must apply to the IRS to become a qualified organization..You can ask any organization whether it is a qualified organization, and most will be able to tell you. Or go to IRS.gov. Click on “Tools” and then on “Exempt Organizations Select Check” (www.irs.gov/Charities-&-Non-Profits/Exempt-Organizations-Select-Check). This online tool will enable you to search for qualified organizations.
Expert:  Lane replied 1 year ago.
Types of Qualified OrganizationsGenerally, only the following types of organizations can be qualified organizations.A community chest, corporation, trust, fund, or foundation organized or created in or under the laws of the United States, any state, the District of Columbia, or any possession of the United States (including Puerto Rico). It must, however, be organized and operated only for charitable, religious, scientific, literary, or educational purposes, or for the prevention of cruelty to children or animals. Certain organizations that foster national or international amateur sports competition also qualify.War veterans' organizations, including posts, auxiliaries, trusts, or foundations, organized in the United States or any of its possessions (including Puerto Rico).Domestic fraternal societies, orders, and associations operating under the lodge system. (Your contribution to this type of organization is deductible only if it is to be used solely for charitable, religious, scientific, literary, or educational purposes, or for the prevention of cruelty to children or animals.)Certain nonprofit cemetery companies or corporations. (Your contribution to this type of organization is not deductible if it can be used for the care of a specific lot or mausoleum crypt.)The United States or any state, the District of Columbia, a U.S. possession (including Puerto Rico), a political subdivision of a state or U.S. possession, or an Indian tribal government or any of its subdivisions that perform substantial government functions. (Your contribution to this type of organization is deductible only if it is to be used solely for public purposes.)
Expert:  Lane replied 1 year ago.
And of course, Public Charities.Let me know a little more detail and I can provide a more specific answer.Lane

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