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Gifting to Charity in Your Estate Plan

For many people, religious or philanthropic missions become a cornerstone of life. This is especially true during these difficult times. As a result, some people want to leave a gift in their estate plan to the charity or religious organization of their choosing. Perhaps you have thought about doing this but were unsure of how to go about it. In this article, we will go over how to leave a gift to a charity or religious organization in your estate plan.

What Can You Gift?

Through your estate plan, you can gift any assets you have. Common assets such as cash, investments, real property, art, and so forth can all be bequeathed to a charity. So long as you own the asset and have the right to give it away, you should be perfectly able to give that asset to a charity through your estate plan.

When giving a bequest, you don’t have to give anything specific. For example, a general bequest is usually a monetary amount that can be taken from any asset in the estate. If you leave your local house of worship $10,000 without specifying where that money is to come from, you have left them a general bequest. They will likely be paid $10,000 from whatever liquid assets are available and not already bequeathed to someone else.

You can also give the residual of your estate away. For example, you can say that you want a particular charity to inherit whatever is left of your estate after your other beneficiaries have inherited. In this instance, your other beneficiaries will all get their respective inheritances and then the charity will inherit the remaining assets.

How to Gift

There are several ways to leave assets behind for the charity or religious organization of your choosing. The first way is to leave the assets in a will or a trust. Here, you would name the religious organization or charity, but you would need to obtain the organization’s EIN, fill out the relevant forms, and notify the charity of your intentions. You would also name what assets you intend to give to them.

The next way to gift to a charity is to designate the charity as the beneficiary of a life insurance policy or retirement account. Life insurance policies and retirement accounts, such as 401(k)s, allow you to name a beneficiary directly on the account. You could name the charitable organization you would like to benefit from the account, and then upon your passing, the organization will inherit the funds.

Another option that is available is to donate the assets to charity during your lifetime. The main benefit here is that if you donate the asset during your lifetime you can enjoy the tax benefit that comes with making such a donation. You can get another benefit if you donate a stock by transferring it directly to the organization; in this case, in addition to the tax writeoff, you also avoid paying capital gains tax if the stock went up in value since the time you purchased it. The downside is that you then lose that asset for the rest of your life. Regardless of when you would like to donate to the organization of your choosing, an experienced estate planning attorney can help you understand all of your options, enabling you to make the best choice for your situation.

Tax Implications

There certainly may be some tax benefits that could result from donating to a charity during your lifetime. The exact nature of these benefits can depend on several conditions surrounding a particular donation. While you may enjoy some benefits, it is recommended that you speak with a tax professional who can offer insight to your specific situation.

While the federal threshold for estate taxes is currently $12.92 million for single individuals, certain states may have a lower threshold that can subject an estate to taxes. If you believe your estate may be over either the federal threshold or the threshold of your home state, then giving gifts to charity may be a good way to get your estate under that threshold.

In instances where you name a charity as a beneficiary for a particular account or life insurance policy, that asset will not be counted against the estate. This can help to shave large amounts of money off of the value of the estate, possibly bringing the value of the estate under any taxable thresholds. Since the charity is the beneficiary, rather than naming a trust as the beneficiary, for example, that asset is never counted as a part of your estate and therefore not counted toward the value of the estate.

How Can Rosenblum Law Help?

The process of leaving charitable gifts behind in your will may seem confusing at first. Having a knowledgeable estate planning attorney to help you through the process can be immensely beneficial. There may be many things to consider when bequeathing a charity. What assets do you want to leave them? How should you go about leaving these assets? Will this gift affect other parts of your estate plan?

Our experienced estate planning team at Rosenblum Law can help you answer all of these questions. Donating to charity or a religious organization of your choosing is a noble goal. Do not let any confusion or uncertainty surrounding the process of donating stop you from helping out a cause that means so much to you. For a free, no-obligation consultation, call Rosenblum Law at 888-235-9021.


Rabbi Adam (Chananya) Rosenblum, Esq., is the founding attorney and principal of Rosenblum Law, which has provided over two decades of legal service to the community at large.

In addition to serving as principal of Rosenblum Law, he is involved in a number of volunteer and charitable endeavors, including mentorship, giving weekly Torah classes and running educational trips for Jewish outreach organizations.

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