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Understanding Bequests: A Simple Path to Lasting Impact

Tax Wise Giving Methods Bequests

Bequests stand as a cornerstone in the world of planned giving, offering a straightforward and impactful way to support causes close to our hearts. One of the easiest ways to make a planned gift is through a will, a popular choice for many due to their simplicity and effectiveness.

But despite the ease and popularity of bequests, a startling number of American adults lack a will or an estate plan. Caring.com’s 2024 survey reveals that only 32% of Americans have a will, marking a 6% decrease since last year and the first decline in estate planning rates since 2020. This drop is more pronounced among lower-income Americans, who increasingly cite a lack of assets as their reason for not engaging in estate planning. The survey also highlights interesting trends, such as an increase in estate planning among young adults aged 18-34 and a significant rise among Black Americans since 2020. These shifts underscore the evolving landscape of estate planning in America, influenced by factors like economic changes and growing income inequality.

This means that a significant 68% are potentially leaving the management of their assets and decisions in the event of disability or death to external parties, including state entities. This lack of preparation can lead to unintended consequences for one’s assets, heirs, and legacy. Establishing a will is a crucial step in ensuring that your final wishes are respected and executed as you intend.

A bequest is a gift made through your will or trust, an essential part of estate planning. It can be structured in various ways: a specific bequest donates a certain asset or fixed dollar amount; a percentage bequest allocates a portion of your estate; a residual bequest gifts what remains after other bequests are fulfilled; and a contingent bequest takes effect under certain conditions. Each type offers flexibility to meet individual donor needs and intentions. For more information on Wills and Trusts can be found here

Many choose to leave bequests to charities, like the IEEE Foundation, for reasons beyond mere generosity. For some, it’s a way to make a significant impact, continuing their support for a cause even after they’re gone. Tax benefits also play a role; bequests can reduce the estate tax burden, which varies based on where you live and how much (and what types of assets) you leave behind, ensuring more of your legacy goes to your chosen beneficiaries and causes.

Bequests are just one method of planned giving. In the future, we’ll explore other simple options like retirement plan beneficiary designations and gifts of life insurance. Each offers unique benefits and opportunities to provide for your loved ones while also supporting your philanthropic goals.

Bequests provide a powerful yet simple way to leave a legacy. As you consider your estate planning and charitable giving, remember the impact a bequest can have. If you’re interested in learning more about bequest giving to the IEEE Foundation, click here or contact Danny DeLiberato, Development Officer, at +1 732.562.5446 or e-mail at d.deliberato@ieee.org.

This article is intended to provide general gift planning information. Our organization is not qualified to provide specific legal, tax or investment advice, and this publication should not be looked to or relied upon as a source for such advice. Consult with your own legal and financial advisors before making any gift.  

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