How Can I Ensure My Charity Bequest is Used Correctly? Shelly Joyner, Paralegal

How Can I Ensure My Charity Bequest is Used Correctly? Shelly Joyner, Paralegal

You want to help others. You like the idea of leaving a legacy. You want to make sure that your hard-earned assets are utilized with your charitable goals in mind. You want to make sure that nothing is wasted in bureaucratic nonsense.

Just saying, “I give $25,000 to St. Jude Children’s Research Hospital” will more than likely be sufficient to get a donation where it needs to go. However, estate planning attorneys and charitable giving directors at your favorite charity can help plan so that your wishes are coordinated with their needs in the most efficient way possible.

I’ve been working closely with the charitable giving team at the University of North Texas on behalf of a client who wanted to leave a very specific kind of scholarship gift. Our clients wanted to leave money to fund a scholarship to benefit a very narrow class of students. However, after working with the client and UNT, we were able to put a reference in the client’s trust to a Memorandum of Understanding (“MOU”).

I talked to UNT about what my clients’ goals were and why they wanted to establish a scholarship as part of their trust plan. I found out that there was already a well-established program focused on my clients’ interests. They told me that sometimes, when a donor has a very specific interest and wants to leave a scholarship for a very specific kind of student, that specific student can’t be located and the school has to waste resources trying to figure out the next closest thing. Conversely, when donors leave an overly broad gift, the school has to waste resources trying to figure out which department the gift should go to. I worked with UNT to create an MOU for my clients that would leave a gift to that already-established program, but with a preference for it going to a very specific scholarship, if a student that fits the criteria can be found. 

The other great thing about creating a MOU is that it can be broadly referenced in the trust, so that the specifics of the gift can be changed without having to amend the entire trust: “I give 10% of the residue of my estate to The Humane Society of North Texas according to our Memorandum of Understanding.” That way, if you originally wanted your gift to support a grant of adoption fees but later want to change it to specifically fund medical care for animals, you can easily do it by just changing the MOU rather than amending your trust.

There are other ways of planning for giving charitable gifts that an estate planner can discuss with you to maximize your impact and minimize tax consequences.

Make an appointment with us today so that we can help facilitate your charitable giving.

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