“ It's better to give than to receive.”
Giving from the Grave:
How Bequests Work
By the use of a will or an estate strategy, various types of assets such as cash, stocks, jewelry, land, etc., can be given to family members, friends, institutions or charities in the form of what is known as a “bequest”. In many cases this is done to avoid various taxes that can affect a will in almost every country around the world. By this very action many charities and institutions benefit in receiving help they would otherwise not get.
There are 2 types of charitable bequest gifts — the legacy where the bequest (usually land or money) is left to a specific charity, or an endowment if the bequest is given for a specific purpose. The endowment is a “gift that keeps on giving” in that a fund is set up with annual proceeds (usually a set amount) going to a specific charity.
In most cases when a person wants to bequest a gift it is done while the person is alive and done legally with either an estate planner or a legal expert (such as a lawyer). In making a charitable bequest, the testator must include in the will what charity the gift is for. More information is available at endowdevelop.com for charitable bequests in the US. For Canada: legalwills.ca. For the UK: moneyadviceservice.org.uk.
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Here are a few other websites that can help you with any bequest decisions:
- moodylegacy.org
- jerusalemfoundation.org
- worldvision.org
- caritas.org
For those who love animals in the US: humanesociety.org.
Copy these prompts. Paste them into your favorite AI application. Get more information.
Types of Bequests and Legal Definitions
There are two main types of bequests mentioned, but are there actually more specific categories used in estate planning.
"It is mentioned 'legacy' and 'endowment' bequests. What are the other specific types of bequests, such as residuary or specific bequests, and how do they work?"
"Can you explain in more detail what a 'specific bequest' is and give me examples of assets that are commonly given this way?"
Financial and Tax Planning
A major reason for making a bequest is to manage taxes effectively for your heirs.
It is mentioned avoiding taxes. How do charitable bequests help reduce estate taxes in the US, and what are the current exemption amounts?"
"I have a retirement account like an IRA or 401(k). Is it better to leave this to charity or to my children from a tax perspective? Please explain why."
"What is the difference between making a gift during my life and a bequest in my will, especially when it comes to taxes on capital gains?"
Country-Specific Information
Provide bequest websites for different countries, which is a great starting point for localized advice.
"I want to make a charitable bequest in Canada. Based on the PDF's link to legalwills.ca, what are the key legal requirements for a will to be valid there?"
"What kind of free or low-cost advice about writing a will and including charitable gifts does the UK's 'Money Advice Service' offer?"
Working with Charities
Leaving a bequest requires clear communication with the organization you wish to support.
"There are several charities like the Humane Society and World Vision. How should I contact a charity to discuss leaving them a bequest, and what specific information should I have ready for my lawyer?"
"If I want my bequest to be used for a specific purpose, like research or caring for animals, how do I ensure my wishes are carried out by the charity?"
Advanced Estate Planning Concepts
For those with larger estates or specific family situations, there are more complex strategies to consider.
"What is a 'generation-skipping transfer tax' (GSTT) and how might it affect my decision to leave money directly to grandchildren versus a charity?"
An 'endowment' is a gift that 'keeps on giving.' Can you explain in more detail how an endowment fund is set up and managed by a charity?
Some suggested AI sites are: ChatGPT, Claude.ai, Perplexity.ai, Deepseek and others.
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