Charitable Giving Considerations in Estate Planning

The New York Times recently profiled Sylvia Bloom, a former legal secretary who passed away in 2016 at the age of 96 after quietly amassing over $9 million during her lifetime. Ms. Bloom acquired these funds by investing wisely during her 36-year career at the same law firm, during which she lived in a rent-controlled apartment and commuted to work every day on the subway. Ms. Bloom lived frugally, and her family and friends were stunned following her death to learn of her wealth. However, to the surprise of no one, Ms. Bloom’s Will provided that most of her assets will be distributed to charitable organizations that provide scholarships for needy students. The organizations, upon learning of the gifts, were overjoyed by Ms. Bloom’s generosity.

As Ms. Bloom’s estate demonstrates, charitable giving is an important aspect of estate planning. Many individuals provide for charitable organizations, schools, and religious institutions during their lives, and the estate plan is a great way of continuing these wishes after death. Charitable bequests are exempt from Pennsylvania Inheritance Tax, and do not count against an individual’s Lifetime Federal Estate and Gift Tax Exemption (currently $11.2 million per person). Including charitable bequests in an estate plan can allow an individual to direct the specific use of the gift, or provide for alternative uses if the chosen organization is no longer in existence or has been acquired by a similar group. If an individual is considering making a significant lifetime or testamentary gift to a charity, certain estate planning techniques may be used to provide for the best outcome for both the individual and the charitable organization. If you wish to speak with an attorney about these or other considerations, please contact our office for further discussions at 610-648-9300.