Know these 4 types of bequests
December 9, 2014 The NonProfit Times
By definition, a bequest is a gift of personal property (money, a house, etc) that is made through a will. Yet not all bequests are created equal.
In her book “The Complete Idiot’s Guide to Giving Back,” Elizabeth Ziemba, J.D., M.P.H., notes that a recent edition of Giving USA, a report published annually by The Giving Institute, reported that charitable organizations received more than $23.15 billion bequests in 2007. These gifts came in many different forms, and it’s important for fundraising officers to clearly understand their differences.
Ziemba explained that there are four basic types of bequests or gifts that can be made in a will. All of these can be mixed and matched in the donor’s will, depending on giving goals. The four types are:
- Pecuniary Bequest: A gift of a fixed or stated sum of money designated in a donor’s will.
- Specific Bequest: A gift of a designated or specific item in the will. The item will most likely be sold by the organization and the proceeds would benefit that nonprofit.
- Residuary Bequest: A gift of all or a portion of the remainder of the donor’s assets after all other bequests have been made as well as debts and taxes paid.
- Contingent Bequest: A gift in a will made on the condition of a certain event that might or might not happen. A contingent bequest is specific and fails if the condition is not made.