What Is a Bequest?
Legacy giving is one of the most powerful ways to ensure your values and philanthropic vision continue making a difference long after your lifetime. Through thoughtful estate planning that includes charitable giving, you can create transformative change in the community you call home, build a meaningful legacy for future generations, and receive substantial financial benefits during your lifetime.
One very powerful tool for estate planning and legacy giving is bequests. But what is a bequest? And why should you incorporate them into your estate plans sooner rather than later?
The Philanthropic Advisors at Greater Houston Community Foundation provide comprehensive guidance on bequests, reflecting our commitment to helping donors make meaningful gifts that align with their values and maximize their impact.
Continue reading to find out more about bequests, or get in touch with the Community Foundation today to ask us directly.
Key Insights
- A bequest is a planned charitable gift that takes effect through your estate plan after your passing, differing from lifetime gifts by providing estate tax benefits rather than immediate income tax deductions.
- Charitable bequests can be structured as specific dollar amounts, percentages of your estate, residual gifts, or contingent provisions that activate under certain circumstances.
- Working with estate planning attorneys and philanthropic advisors helps ensure that your bequest language is legally sound and aligns with your overall financial and charitable goals.
- Bequests through Greater Houston Community Foundation leverage local expertise and established nonprofit relationships to maximize your charitable impact in the greater Houston community and beyond if that is your intent.
- Depending on your overall estate, charitable bequests can provide some people with estate tax advantages while also allowing you to create a lasting philanthropic legacy reflecting your values.
Table of Contents
- The basics of bequests
- Why charitable bequests matter in philanthropy
- How to include a bequest to a nonprofit organization in your estate plan
- The role of the Community Foundation in bequest and estate planning
- Benefits of making a bequest through the Community Foundation
- Bequests can be simple with the Foundation at your side
The basics of bequests
A bequest is fundamentally different from a traditional charitable gift in both timing and implementation. While a standard charitable contribution occurs during your lifetime and provides immediate tax benefits, a bequest is a planned gift that takes effect through your estate plan after your passing.
What’s the difference between a gift and a bequest?
While bequests have some things in common with traditional gifts to charitable organizations, there are some fundamental differences. Some of the most important differences between the two include:
| Charitable gift | Bequest |
| Made during your lifetime | Takes effect after your passing |
| Provides immediate tax deductions | Reduces estate tax liability |
| Immediate impact on chosen causes | Long-term legacy impact |
| Make multiple charitable gifts that vary in purpose | May require estate plan amendments to change |
What is an example of a bequest?
A bequest can be structured according to your preferences, but it is important to consult your estate planning attorney and advisors when creating one. A straightforward example of a typical bequest might read as follows:
“I give, devise, and bequeath to the Greater Houston Community Foundation, a Texas nonprofit corporation (the “Community Foundation”), the following assets: [Insert specific assets, dollar amount, percentage, or residuary] to be added to my existing donor advised fund [Fund Name], or if no such fund exists, to establish a donor advised fund in my name to support charitable purposes.”
The language of a bequest can be as simple or as complex as you’d like—whether you’re looking to put a lump sum toward one cause or have a philanthropic partner that you trust to effect more widespread change, bequests give you significant control over your long-term legacy.
Common types of bequests
Bequests can be structured in several ways to meet different donor goals and circumstances. Some of the more common structures for bequests are:
- Specific bequests designate a fixed dollar amount or particular asset to a charitable organization.
- Percentage bequests allocate a portion of your estate’s total value to charity.
- Residual bequests direct the remainder of your estate (after other distributions) to charitable causes.
- Contingent bequests activate only under certain circumstances, such as if primary beneficiaries predecease you.
Making the right type of bequest for your financial situation can offer unique advantages for your philanthropic goals. Incorporating charitable giving into your estate planning can allow you to make larger gifts than might be possible during your lifetime, while potentially reducing estate taxes and creating a lasting legacy that reflects your values.
Why charitable bequests matter in philanthropy
Ask any estate planning attorney or professional—charitable bequests are a powerful tool for those with significant wealth planning for the generations that follow them. A few major differences that bequests make in philanthropy are:
- They help donors create a legacy. Bequests enable you to extend your philanthropic impact beyond your lifetime, ensuring that causes important to you continue receiving support. This form of giving to charity in your will creates a permanent reminder of your values and commitment to community betterment.
- They support causes donors care about most. Whether your passion lies in education, healthcare, arts, or social services, bequests allow you to provide substantial support to organizations working in these areas. The predictable nature of planned gifts helps nonprofits plan for long-term initiatives and sustainable programs.
- The collective impact of bequests on community well-being is massive. Often representing a donor’s largest gift, bequests are also among the most popular ways individuals leave a lasting legacy, shaping the future of their communities for generations.
How to include a bequest to a nonprofit organization in your estate plan
Incorporating a charitable bequest starts with thoughtful collaboration between your estate planning attorney and your philanthropic advisor. Together, they ensure your will or trust includes the appropriate language while also helping you craft a clear, lasting statement of donor intent. This combination of legal precision and philanthropic guidance provides confidence that your charitable wishes will be carried out exactly as you envision.
- Identify your charitable interests: Determine which causes, organizations, or geographic areas you want to support through your bequest.
- Consult with your estate planning attorney: Work with legal counsel and the Community Foundation team to draft appropriate bequest language for your will or trust.
- Choose your bequest type: Decide whether you want to make a specific, percentage, residual, or contingent bequest.
- Determine the bequest amount: Consider what portion of your estate you wish to dedicate to charitable purposes.
- Draft precise legal language: Make sure your estate planning documents include clear, specific language that accurately reflects your charitable intentions.
- Review and update regularly: Periodically revisit your bequest provisions to ensure they still align with your philanthropic goals.
- Partner with the Community Foundation: If you plan to benefit multiple organizations with bequests or to pass on philanthropic assets to successors, consider using a donor advised fund at the Community Foundation to achieve those goals.
Important legal considerations and documentation
Proper documentation is essential for ensuring your bequest intentions are fulfilled. Your estate planning documents should include specific language identifying the charitable recipient, the nature of the gift, and any particular instructions for how the funds should be used. It’s also important to provide alternative designations in case your chosen organization no longer exists when the bequest takes effect.
Working with trusted advisors and estate planning attorneys
Successful bequest planning requires collaboration between multiple professionals who understand both estate law and philanthropic strategies. A combination of your estate attorneys, financial planners, and philanthropic advisors should work together to make sure your charitable intentions integrate seamlessly with your overall estate plan.
Like all estate planning materials, bequests are living documents that benefit from regular review by yourself or trusted professional advisors.
The role of the Community Foundation in bequest and estate planning
We offer tailored solutions and support.
Greater Houston Community Foundation provides comprehensive support throughout your bequest-planning journey. Our experienced team helps you explore various giving options, understand tax implications, and structure your charitable gifts for maximum impact. We work closely with your existing advisors to help ensure all aspects of your plan work together harmoniously.
We offer customized giving options aligned with donors’ values.
Every donor has unique philanthropic interests and financial circumstances. We help you identify giving vehicles and charitable strategies that align with your specific values and goals, whether that involves supporting particular causes, geographic areas, or types of organizations.
We offer assistance with establishing charitable bequests and trusts.
Our Philanthropic Advisors can help you explore various bequest structures, from simple charitable bequests to more complex arrangements like charitable remainder trusts or charitable lead trusts. We can work with your team of advisors to determine how each option might fit within your broader estate planning strategy.
Your story matters to the Community Foundation. Through our Legacy Project workbook, we guide you in capturing your story, crafting a legacy letter, and creating a statement of donor intent that clearly expresses your philanthropic wishes. As an enduring institution in Houston, the Community Foundation serves as a steward of countless stories of generosity—stories that have shaped lives and communities locally and around the world. We are committed to preserving your story and ensuring that your impact continues for generations to come.
Benefits of making a bequest through the Community Foundation
Aside from the many benefits of making bequests for your financial and estate plans, there are a number of benefits of doing so with an organization like Greater Houston Community Foundation, whose local knowledge and industry expertise can do the following.
- Make sure your gift makes a meaningful difference. By directing your bequest through Greater Houston Community Foundation, you leverage our deep community knowledge and established relationships with local nonprofits.
- Reduce estate tax and provide other estate planning benefits. Charitable bequests provide valuable estate tax advantages through charitable contribution deductions. Understanding the taxation on donations and their impact on your estate can help maximize both your philanthropic impact and your family’s financial benefit.
- Preserve flexibility and influence over your donation. One key advantage of working with the Community Foundation is the option to establish a bequest to a donor advised fund, enabling your designated successors to continue making grant recommendations that reflect your charitable interests.
Bequests can be simple with the Community Foundation at your side
Greater Houston Community Foundation is dedicated to building stronger, more resilient communities throughout Greater Houston. Our legacy giving programs are designed to channel your charitable bequests toward initiatives that create lasting positive change and address our community’s most pressing challenges.
Your charitable bequest becomes part of a larger philanthropic ecosystem that supports essential community programs. From disaster relief efforts to educational initiatives, healthcare services, and arts programs, your gift contributes to the foundation that helps Houston thrive.
Wondering when to start planning your legacy? There’s never been a better time. Whether you’re just beginning to think about estate planning or are ready to refine an existing plan, starting your plan early allows you to create a legacy that reflects your values and continues making a difference for generations to come.
Ready to explore how a charitable bequest can enhance your legacy? Call Jennifer Touchet, Vice President of Personal and Family Philanthropy, today at 713-333-2228 or reach out directly to learn more about incorporating charitable giving into your estate plan. Our team of experienced philanthropic advisors is here to help you create a lasting legacy that makes a meaningful difference in the Houston community.
For a more detailed look at bequests at the Foundation, continue reading: Our complete bequest language
More Helpful Articles by Greater Houston Community Foundation:
- How To Preserve Generational Wealth
- What Is the Great Wealth Transfer?
- The Power of Collective Giving
- How To Get Started with Legacy Giving
- What to Do with an Inheritance
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