In this first article in a series, we look at that popular technique for giving to charity at death: the bequest.
In my experience, the bequest is by far the #1 type of gift that donors would establish during lifetime to support their favorite organizations after they were no longer around.
And there are good reasons for its popularity: it is relatively simple to do, it doesn’t cost anything now (other than legal fees), and you can always change your mind down the road.
A bequest is an instruction in a will or living trust to distribute an asset from someone’s estate. Just like you would remember family and perhaps friends with a bequest, you can do the same with a charitable organization.
Bequests come in several flavors:
- Specific amount – you specify a certain dollar amount (“I bequeath $50,000 to ABC Charity”)
- Percentage – you designate a percentage of your estate (“…10% of my estate to XYZ Foundation”)
- Residual – you designate whatever is left over after other specific and/or percentage bequests (“…the remainder of my estate to the John and Jane Smith Foundation”)
- Specific asset – you specify a particular piece of property (…my Van Gogh painting to the City Art Museum)
- Note: if you have a specific asset you wish to give away, contact the organization in advance to ascertain whether the asset is something the charity can or would want to accept.
Establishing a bequest is simple. Consult with your estate planning attorney and have them draft the bequest for you either as a codicil to your will or an amendment to your living trust.
Be sure that your attorney uses the charity’s correct legal name in the bequest to ensure that the correct organization receives the gift. This is especially important when there are similar-sounding charities or for those with both a national office and local chapters.
Once the bequest is official, consider letting the organization know what you have done. Most charities have established programs (like this one) to honor and thank donors who have included the charity in their estate plan through a bequest. It gives the charity the opportunity to thank you now.
If you are concerned about privacy, you can always ask the organization to keep your name anonymous on any public lists of donors. You can also ask that they not send you any additional solicitations in the mail.
Giving by bequest is not only simple, it is deeply satisfying. Get started today by contacting your estate planning attorney or the development department of the organization you wish to include.
Comments or questions? Contact me on Twitter: @juanros.