Estate Planning Newsletter

• Offering Your Estate to a Charity
  It is possible to set up a trust for charitable purposes. Charitable trusts are quite common, but certain requirements must be met. Purpose of a Charitable Gift Reasons for charitable gifts funded through... Read more.
• Marital Deductions & Non-Citizen Spouses
  A QDOT is a specific type of marital deduction trust that is designed to ensure that non-citizen spouses will eventually pay any taxes that may be due upon distribution of the principal from the trust, even if the surviving spouse... Read more.
• Reverse Mortgages for Enhancing Retirement
  Many are familiar with the concept of a mortgage, where an individual makes monthly payments to a lender. However, for those who qualify, there is another type of mortgage called a “reverse mortgage” (RM), where the lender... Read more.
• Advance Directives for Health Care Decisions
  A power of attorney is a document that authorizes one or more individuals (collectively referred to as the “agent” or “attorney-in-fact”) to act on behalf of the person executing the document (the... Read more.

• New Tax Laws Effect Estate Planning
• This threat could devour thousands of dollars from your estate
• Fidelity Investments: Estate Planning Should Include the Home
• Blended marriages take careful estate planning
• Trust Agreements and Due-on-Sale Clauses

When Your Charitable Gift Fails

If you create an estate planning document leaving property to a charity, but after your death the transfer cannot occur, the court may apply the cy pres rule.

The words “cy pres” are French for “as near.” If your charitable wishes cannot be achieved, the court uses this doctrine to attempt to fulfill your wishes as near to your original wishes as possible.

Why a Gift May Be Non-Transferable

Your charitable gift may not be transferable to your chosen charity because that charity:

• Refuses to accept it
• Could not be identified
• No longer exists on the date of your death

Additionally, a gift may not be possible due to the fact that you:

• Identified more than one charity in an ambiguous manner
• Failed to name a specific charity as recipient
• Failed to specify a charitable purpose

Under cy pres, when your charitable gift cannot be transferred to the organization specified in your trust, it may be given to a related charity that has a related charitable purpose.

Limited Application

The cy pres rule typically will not be applied unless there is no way your particular charitable purpose is possible. Courts are reluctant to second guess intent, so the rule may not be applied if you have not clearly articulated a charitable intent.

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