Leaving a charitable legacy

For some people, the most meaningful gift they'll ever make is the one that happens after they die. Legacy giving lets you direct a portion of your estate to causes you care about, with structures that range from simple (a bequest in a will) to elaborate (a charitable remainder trust). The tools aren't just for the very wealthy — most work at modest scales too.

Bequest: the simplest form

A bequest is a line in your will or trust directing a specific dollar amount, percentage, or asset to a charity. No minimum complexity, no special accounts, no fees. Your attorney adds a paragraph. It costs nothing during your lifetime and is 100% tax-deductible from your estate. This is the right answer for most people who want to include charity in their plans.

Beneficiary designations

Name a charity as a partial or full beneficiary of a retirement account or life insurance policy. For Traditional IRAs, this is particularly clever — leaving a pre-tax IRA to a charity means the charity receives the full amount tax-free, while leaving the same asset to a family member would hit them with ordinary income tax. Good strategy for anyone giving from multiple buckets.

Charitable Remainder Trust (CRT)

A more elaborate tool for larger estates. You transfer appreciated assets to a trust, receive income from the trust for life (or a fixed term), and at the end of the term the remainder goes to charity. You get a partial tax deduction now, defer capital gains on the appreciated assets, and ensure your estate plan includes the gift. Setup costs and complexity make this worthwhile only at larger asset levels.

Charitable Lead Trust (CLT)

The mirror image of a CRT. The trust pays income to charity for a period of years, and then returns the remaining assets to your heirs. Used by wealthy families to pass assets to the next generation while removing them from the taxable estate. Very niche but very powerful at scale.