Don’t Forget Charities

Macharitable-givingny of us give to our favorite charity on a regular basis, but when making our estate plans, completely forget about them.  I find many clients are concerned that if they give to a charity, their family will get nothing.  But this is not necessarily true – unless you want it to be.  Making a gift to a charity is the ultimate and final way you can help your favorite charity.

So here are a few ways to leave gifts to charity.

  • Leave a percentage or all of an IRA or life insurance policy to a charity. Simply change the beneficiary form to indicate what amount or percentage you want to go to the charity (or charities).  This method avoids the need to change your will or trust.
  • Leave an outright gift to charity in your will. Again a stated amount or percentage can be listed or, if you desire, you can leave everything to a charity.  But most often clients simply make a specific bequest of a stated amount that they will leave to charity and the rest of their estate passes to family or friends.
  • Leave stock or specific property to charity. If you are thinking about doing this, be sure you check with the charity to ensure they are willing to accept the bequest.  Some charities insist that stock or property be converted to cash before being passed to them, may only accept certain types of property or may refuse the gift entirely on various grounds.

Any of the preceding gifting ideas can be simple outright and open gifts to the charity, they may be restricted so the charity can only use it for certain purposes, they can be set up as an ongoing endowment for the charity, or they can be contingent gifts that are payable only if the person you want to receive your estate in the first instance predeceases you.

With current estate tax exemption amounts exceeding five million dollars, many clients are not concerned about the tax deductions their estates might obtain from leaving assets to charity.  But for those who are facing potential estate taxes, charitable giving can have significant benefits.  Check with your estate planning attorney or CPA for details of your particular situation.

Hopefully these ideas will inspire you to think about those charities that are important to you when you are doing your estate planning.

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