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Not all bequests are created equal

The National Philanthropic Trust estimates that upwards of $27.4 trillion in charitable bequests will be made in the U.S. through 2052. In fact, interest in planned giving has grown in the wake of the Great Recession. Donors have found that committing future gifts from their estate allows them to support a charity — even if they lack the means for a current gift.

At its most basic, a bequest is a gift of personal property made through a donor’s will. Such property could be anything from money and real estate to works of art or even patents and other intellectual property. Yet not all bequests are created equal, and it is critical for fundraising officers to clearly understand the differences.

  • Pecuniary Bequest – A fixed or stated sum of money designated in a donor’s will.
  • Specific Bequest – A designated or specific item in the will. Typically, the item is intended to be sold by the organization and the proceeds to benefit its charitable work.
  • Residuary Bequest – All or a portion of a donor’s assets that remain after all other bequests have been made and any debts and taxes paid.
  • Contingent Bequest – A gift made on the condition of a certain event occurring. For example, a specific bequest to fund a special shelter if an animal welfare organization attains the property to house it.

Note that these different types of be-quests can be mixed and matched in the donor’s will. Ultimately, most nonprofits have substantial untapped potential for bequests through their major and annual donors. The key is to establish and nurture the strong relationships necessary to be written into a will.

An experienced accounting professional can be invaluable in evaluating and man-aging donor bequests.

For more information on this topic or to learn how Baker Tilly specialists can help, contact our team.

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