A Bequest to Save Taxes
Thomas was a widower who had a great love for his church and other charities. As an individual who had directly benefited from each work, Thomas wanted to thank them with a gift from his estate.
Thomas told his attorney that he wished to leave bequests as part of his estate plan. Thomas's estate included some stocks, real estate and an IRA. Thomas's attorney recommended that he give the appreciated stock and real estate to his children and leave his IRA to charity.
Thomas: My attorney told me that if I gave the stock and real estate to my children, these assets would receive a step up in basis at my death. My children could then sell them without paying tax. However, if I gave my children my IRA, the IRA would be subject to estate and income tax. After paying all of these taxes, very little would be left for my family. By giving the IRA to a Co:Mission Giving Fund (a donor advised fund), I could make nice gifts and avoid any additional tax for my estate and children.Thomas contacted his IRA custodian to obtain a beneficiary designation form. He filled out the form and designated his Giving Fund as the 100% recipient of his IRA account. Thomas's attorney then specified in Thomas's will the bequest of his other assets to his children.
Thomas: I was so impressed with my attorney's advice that I named him executor of my will!
Is a bequest right for you?
It is easy and convenient to include a bequest in your will or living trust. This link includes sample bequest language that can very easily be included in your will.
You might find it helpful to print this page and the bequest language to give this information to your attorney. If you or your attorney have any questions, please contact us.
*Please note: The name and image above are representative of a typical donor and may or may not be an actual donor to our organization. Since your benefits may be different, you may want to click here to view a color example of your benefits.