Bequests

By | November 30, 2017

“I bequeath….”

The bequest is one of planned giving’s simplest forms. A bequest is a gift that is written into a donor’s will that is fulfilled after their death. These gifts can be written in the will itself or added as a codicil (addendum) after the main will has been ratified.

It would be impossible for me to go into explicit detail on all of the legal niceties on bequests. Since I’m not a lawyer, I am not competent to provide legal advice nor do I intend to provide legal advice. It is good, however to know that donors have several different options in how they word a bequest in their will that will make a substantial difference in the type and size of gift.

Types of Bequests

Several different types of bequest allow you to get very specific about the kind of gift being made. Essentially, each bequest identifies the gift and the person who will receive the gift. A bequest gift can also identify a particular program or type of program that the donor wants to support. As the recipient of an estate gift, you have a legal responsibility to fulfill the intent of the gift.

Each of the following bequest descriptions include sample language for use in a will. It is ok to provide sample language to a donor, but you should tell them to consult legal counsel before making any additions to their wills. If a will is contested and it is found by the court that you were providing legal advice to the donor, it might give cause to nullify the gift and more seriously open you up to criminal charges. Only lawyers who are licensed to practice law in your state should be providing legal advice.

General Bequest – A ‘general bequest’ comes from the general assets of the estate and doesn’t refer to a particular piece of property. It can be a gift of a specific amount of cash or a percentage of the total value of the estate. It might also refer to a number of shares of stock, so long as the bequest in not referring to specific shares or stock certificates. Most financial gifts fall into the ‘General Bequest’ category.

Sample Bequest Language:

A fixed dollar amount: “I give the sum of $___ to the Endowment of the Sisters of Our Lady, 244 Blank Rd, Augusta, GA 30901, Federal Tax ID 58-3844912, to be used or disposed of as its Board of Directors deems appropriate in its sole discretion.”

A percentage of the estate: “I give [state the fraction or %] of my estate to the Endowment of the Sisters of Our Lady, 244 Blank Rd, Augusta, GA 30901, Federal Tax ID 58-3844912, to be used or disposed of as its Board of Directors deems appropriate in its sole discretion.”

A gift of stock or mutual funds: “I give ___ shares of ____ Corporation to the Endowment of the Sisters of Our Lady, 244 Blank Rd, Augusta, GA 30901, Federal Tax ID 58-3844912, to be used or disposed of as its Board of Directors deems appropriate in its sole discretion.”

Specific Bequest – A specific bequest gives a specific item to a named person or entity. This might be an item like a car, piece of real estate, or a valuable piece of art. In the case of a specific bequest, it is very important for the donor to identify the item with sufficient clarity that the executor is able to correctly identify the item to be bequeathed.

Sample Bequest Language:

“I give my 1982 Chevy Chevette to the Endowment of the Sisters of Our Lady, 244 Blank Rd, Augusta, GA 30901, Federal Tax ID 58-3844912, to be used or disposed of as its Board of Directors deems appropriate in its sole discretion.”

Demonstrative Bequest – A demonstrative bequest provides for a specific amount from or of a particular asset. Examples might include $10,000 dollars from a savings account, or 200 shares of Amazon Stock. In the case of a gift of stock, the bequest should make provision for any change in the name of the stock from a buyout or from any mergers or spinoffs that might affect the stock after the will has been ratified.

Sample Bequest Language:

A fixed dollar amount: “I give the sum of $___ from my savings account numbered _______ with ____ Bank to the Endowment of the Sisters of Our Lady, 244 Blank Rd, Augusta, GA 30901, Federal Tax ID 58-3844912, to be used or disposed of as its Board of Directors deems appropriate in its sole discretion.”

A gift of stock or mutual funds: “I give ___ shares of ____ Corporation held in brokerage account #__________ with _____ Brokerage firm, to the Endowment of the Sisters of Our Lady, 244 Blank Rd, Augusta, GA 30901, Federal Tax ID 58-3844912, to be used or disposed of as its Board of Directors deems appropriate in its sole discretion.”

Remainder Bequest – A remainder bequest takes into account the reality that the estate may be larger than the sum of the individual gifts that are listed within it. So a will for an estate of $500,000 that has $250,000 worth of bequests listed will have a remainder of $250,000. Remainder requests enable the donor to take care of any important responsibilities but still leave room to give to charity.

Sample Bequest Language:

“I give all [or state the fraction or percentage] of the rest, residue, and remainder of my estate, both real and personal to the Endowment of the Sisters of Our Lady, 244 Blank Rd, Augusta, GA 30901, Federal Tax ID 58-3844912, to be used or disposed of as its Board of Directors deems appropriate in its sole discretion.”

Contingent Bequest – A contingent bequest makes a gift only if a named beneficiary does not survive the donor. For instance, a man with no children might name your organization as a contingent beneficiary if his wife doesn’t survive him.

Sample Bequest Language:

“If (name/s of primary beneficiary/ies) do/es not survive me, or shall die within ninety (90) days from the date of my death, or as a result of a common disaster, then I give (describe amount of cash, property or percentage of residual estate) to the Endowment of the Sisters of Our Lady, 244 Blank Rd, Augusta, GA 30901, Federal Tax ID 58-3844912, to be used or disposed of as its Board of Directors deems appropriate in its sole discretion.”

Disclaimer

If you include sample language in your materials and are not a practicing attorney, you should include a disclaimer at the bottom of your materials that explains that you are not providing legal advice. I repeat… this is illegal. The following disclaimer is an example of the kind of disclaimer that you should use. Check with your lawyer before using this or any other disclaimer language.

Note – I am not a lawyer, and these examples should not be construed as providing legal advice. Please consult with a qualified lawyer or estate planning professional to ensure that your estate plan accomplishes what you desire.


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