UNIVERSITY OF WASHINGTON
Gifts In A Will Or Living Trust
A charitable bequest is a gift to a charity made at death in a will or trust document. You can make a bequest gift of any size, and direct the gift to support the purpose or program at the UW that is most important to you.
Many people choose to support the University of Washington by including a gift to the UW in their will. For some, this is their first gift to the UW, but for many others this gift is a continuation of giving begun during their lifetimes.
About Bequest Gifts
Bequests are a vital source of private support for the University, representing nearly 17% of all gifts received from individuals annually. In addition to helping support bright and highly motivated students, bequests have also helped to recruit outstanding faculty and to provide stateof-the-art facilities and equipment for teaching and research. The University particularly values unrestricted gifts, which can be used by the president or deans to support priority needs.
Do I need a will or trust? If you want to control the disposition of your property at death, you need to have either a will or a trust. This document directs how and to whom your property is to be distributed. You also can name a person or company to administer your estate and someone to serve as a guardian of minor children. If you do not have a will, state law determines to whom your property is given — with no provisions for gifts to friends or charities. Did you know a gift in your will can be: • A specific dollar amount. • A specific asset you own. • A percentage of all of your property. • The “residue” of your property (what is left of your property after you have made other gifts). • Unrestricted (used for general education purposes of the University). • Restricted (used for a particular purpose). • Structured to provide lifetime income to family before the gift is available for use by the UW. • Contingent (gift is made only if specific conditions occur, i.e., a spouse has died before the donor). • Changed by you at any time.
Where do I start? First, you need to determine the people and charities you wish to support and the property that you expect to be available for those gifts. Next, find an attorney who practices in the state in which you live. The attorney can prepare the written document (will or trust) you need to carry out your plan. Your attorney can alert you to the need for other important documents, such as a durable power of attorney, a medical power of attorney, and a “living will.” If your will includes a gift to the University, you and your attorney should consult with the University’s gift planning staff. They can provide sample language to carry out your intentions. How does the UW use bequest gifts? The University uses gifts from estates as the donor directs. Typically large gifts are designated to establish a named endowment in honor of the donor or other person(s). Endowments are permanent funds designed to provide an increasing amount of annual support for a designated purpose, such as operating support, faculty support, research, and student scholarships. Bequest gifts under $25,000, or those specifically designated by the donor for current use, can provide immediate program support.
Tax Benefits
Can I get any tax benefits from making a bequest gift to the University? Yes. Properly structured bequest gifts may save both estate tax and income tax. However, unlike charitable gifts you complete during your lifetime, you do not receive a current charitable income tax deduction. Estate Tax. Bequest gifts to a qualified charity entitle your estate to an estate tax charitable deduction for the amount that passes to charity. If your estate is subject to tax, your gift to charity reduces the amount of tax your estate must pay. Your will should specify whether charitable gifts should be charged with any part of the taxes resulting from non-charitable gift(s). Estate Income Tax. Income earned during life that has not yet been taxed (as in the case of most retirement benefits and U.S. savings bonds) is subject to income taxes in your estate or in the hands of the beneficiary. These assets are referred to as “income in respect of decedent” (IRD), and can be subject to both estate tax and income tax at the death of the owner. If your will or trust specifically gives an IRD asset to a qualified charity or specifies that a charitable gift is to be paid from that asset, no income tax is required since the recipient charity is tax-exempt. Because your estate avoids income tax and estate tax on the IRD asset given to charity, the gift can cost your heirs comparatively little. You can make a very large gift at a very low “cost.” Charitable gifts from estates present a variety of tax planning opportunities. The University’s gift planning staff can provide information to you and your advisors to consider as part of your overall estate plan.
“I have found the UW to be an excellent channel for fostering a cause in which I strongly believe.”
— Bartley Dobb
Six Steps To Creating A Charitable Bequest Gift To UW
• Create a plan for distributing your property to the people and charities you want to benefit. • Consult with an attorney who regularly drafts wills, trusts and other estate planning documents. • Contact our gift planning staff to discuss your gift to the UW. They can help make sure your gift does exactly what you want. • Ask the gift planning staff to provide you with sample bequest language, and information about tax consequences, for you to share with your attorney. • Provide the gift planning staff with a copy of the final specific provision(s) benefiting the UW. • Receive appropriate acknowledgment and recognition for your intended gift, as you desire.
CONCLUSION
Every day at the University of Washington, bequest gifts are being used to transform the lives of our students, to help our faculty inspire achievements in areas such as the arts, business and medicine, and to provide public service to the community. Your bequest gift can continue this vital work and leave a lasting legacy in your name. If you want to make a difference with a gift in your will or trust, we invite you to contact the Office of Gift Planning for a confidential consultation. We would be pleased to provide you with further information.
Office of Gift Planning University of Washington 1200 Fifth Avenue, Suite 414 Seattle, Washington 98101 Tel: 206-685-1001 or toll-free 1-800-284-3679 Fax: 206-221-2966 e-mail: giftplan@u.washington.edu web site: www.uwfoundation.org/giftplanning