Each year thousands of individuals exercise their right to determine how the estate they have spent a lifetime accumulating is to be finally distributed. Unfortunately, an alarming percentage of Americans leave this distribution up to intestacy statutes. After investing a lifetime in building an estate it seems prudent to execute a valid will and carefully considered estate plan. A will allows an opportunity to:
- Name a guardian for any minor children.
- Stipulate in detail who is to receive which property, including distributions to family members.
- Name who or what institution is to carry out this distribution and see that the deceased's wishes are followed.
- Say when the distribution of the property is to take place.
- Take action to avoid unnecessary shrinkage of the estate to taxes.
- Make a gift to philanthropic organizations.
Charitable bequests are the most common form of planned gifts received by the Foundation. Although such bequests do not provide income tax benefits during the donor's lifetime, they do allow donors the opportunity to make substantial contributions without irrevocably committing assets while living that might be needed for personal security. Charitable bequests to the Foundation may vary in form. The following are some examples.
Specific Bequest - this type designates specific dollar amount or specific property for the Foundation.
"I hereby devise and bequeath $10,000 to the Missouri Western State University Foundation, Inc., 4525 Downs Drive, St. Joseph, Missouri 64507, to be used for its general uses and purposes."
Residuary Bequest - this form of bequests may be used to leave the Foundation all or part of the donor's estate that remains after all other obligations of the estate are satisfied.
"I hereby devise and bequeath the residue of my estate to the Missouri Western State University Foundation, Inc., 4525 Downs Drive, St. Joseph, Missouri 64507, to be used for its general uses and purposes."
Contingent Bequest - this type allows the donor to make a bequest to the Foundation only if other specified events take place prior to the donor's death.
"Should Sally J. Donor predecease me, I hereby devise and bequeath the residue of my estate to the Missouri Western State University Foundation, Inc., 4525 Downs Drive, St. Joseph, Missouri 64507, for its general uses and purposes."
Restricted Bequest - Any of the three types of bequests listed above may be restricted to specific purpose. This allows the donor to restrict the bequest to be used for specific purpose other than the unrestricted "general tax exempt purposes" in the previous examples.
"I hereby devise and bequeath $100,000 to the Missouri Western State University Foundation, Inc., 4525 Downs Drive, St. Joseph, Missouri 64507. This bequest is to be held as a permanent endowment and administered in accordance with state law and the endowment policies of the Board of Directors of the Missouri Western State University Foundation. The endowment is to be used to support a scholarship for students who are majoring in Nursing and demonstrating a need for financial assistance. Should the Board of Directors of the Missouri Western State University Foundation determine that it becomes not feasible or prudent to use the endowment for the purposes stated herein, the endowment may be used for such tax exempt purposes of the Missouri Western State University Foundation as the Board of Directors directs."
The Missouri Western State University Foundation is a qualified charitable organization and bequests to the Foundation are eligible for a federal estate tax charitable deduction.
Keep in Mind
The donor should consult with her/his estate planning and financial advisors as to the exact consequences of a charitable bequest on her/his overall estate plan.
Policies of the Missouri Western State University Foundation
Related Specifically to Charitable Bequests
- Unacceptable Restrictions - Should a donor make a restricted bequest to the Foundation and the terms of the restriction be deemed unacceptable by the Foundation's board of directors, the Foundation shall contact the representative of the estate and explain why the restrictions are unacceptable and request to have the restrictions altered or eliminated. If such action cannot be taken, the Foundation will, by necessity, decline the bequest.
- Advance Notification - The Foundation encourages donors to notify officials of the Foundation when they have named the Foundation in their will to receive a bequest and of the details of any restrictions. This is an attempt to avoid any problems such as unacceptable restrictions and to allow the Foundation to take the bequest into consideration should deliberations take place that might be influenced by such knowledge.
- Donor Recognition - Any donor, who notifies the Foundation that she/he has included a bequest for the Foundation in her/his will, shall be recognized as a member of the Foundation's planned giving society, the Clock Tower Society, unless the donor requests that she/he not be so recognized.