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A Time for Giving: Exploring Charitable Bequests in Your Pennsylvania Estate Plan

Town Law Publishing Dec. 17, 2023

The holiday season is a time for many things: family, joy, and of course, giving. While gifts exchanged under the Christmas tree bring immediate happiness, a more enduring gift can be made through a charitable bequest in your Pennsylvania estate plan.

What is a Charitable Bequest?

A charitable bequest is a gift you make to a charitable organization in your will. This gift can be a specific amount of money, a percentage of your estate, or specific assets, such as stocks, bonds, or real estate. Charitable bequests offer a unique way to support the causes you care about while also providing tax benefits for your estate.

Why Consider a Charitable Bequest?

There are many reasons why you might consider including a charitable bequest in your estate plan. These include:

  • Supporting your passions: You can leave a lasting legacy by directing your resources to organizations that align with your values and beliefs.

  • Tax benefits: Charitable bequests are generally exempt from federal and Pennsylvania inheritance taxes, which can significantly reduce the tax burden on your estate.

  • Simplified estate administration: By specifying charitable bequests in your will, you can simplify the estate administration process and ensure your wishes are followed.

  • Creating a lasting legacy: Your charitable bequest can continue to make a positive impact on the world long after you are gone.

Types of Charitable Bequests:

There are several different types of charitable bequests you can choose from, depending on your specific goals and financial circumstances. These include:

  • Specific bequests: This type of bequest leaves a specific amount of money or a specific asset to a named charity.

  • Residual bequests: This type of bequest leaves a percentage of your estate that remains after all other bequests and debts have been paid.

  • Contingent bequests: This type of bequest leaves a gift to a charity only if certain conditions are met, such as if another beneficiary predeceases you.

Considerations for Making a Charitable Bequest:

Before making a charitable bequest, it's important to consider the following:

  • Your financial situation: You want to ensure that your charitable bequest does not jeopardize your own financial security or the needs of your loved ones.

  • The causes you care about: Research different charities to find organizations that align with your values and mission.

  • The specific type of bequest: Choose the type of bequest that best fits your needs and goals.

  • Tax implications: Consult with a financial advisor or estate planning attorney to understand the tax benefits and consequences of your bequest.

Getting Started with a Charitable Bequest:

If you are considering including a charitable bequest in your Pennsylvania estate plan, here are some steps you can take:

  1. Identify the charities you want to support: Consider causes that are important to you and research their mission and impact.

  2. Determine the amount or type of bequest you want to make: This will depend on your financial situation and your goals for the bequest.

  3. Consult with a financial advisor and an estate planning attorney: They can provide guidance on the tax implications of your bequest and help you draft the necessary legal documents.

  4. Update your will: Make sure your will reflects your current wishes regarding charitable bequests.

A Gift That Makes a Difference:

A charitable bequest can be a powerful way to leave a lasting legacy and make a positive impact on the world. By carefully considering your options and working with qualified professionals, you can ensure that your gift will be used in a way that aligns with your values and creates a lasting impact.

This holiday season, consider the gift of giving that extends far beyond the festive season. Explore the possibility of a charitable bequest and discover how you can make a real difference in the world.

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