Estate planning: Leave a legacy for your children and your community
As you contemplate your legacy and adjust your estate plan over the years, it's natural to focus on your children and family as the primary beneficiaries in your will and trust. If you're like an increasing number of charitably minded individuals, though, you might find that your perspectives about what exactly it means to leave a legacy are expanding beyond your next of kin. Your community is on your mind and in your heart, and you're interested in ways you can support and improve the quality of life for people in the region we call home.
If you're intrigued, you are not alone! Indeed, many philanthropic individuals are broadening their estate plan beneficiaries to prominently include their community or favorite cause right alongside their children and grandchildren. The team at the community foundation would be honored to discuss the ways we can help. Here are three options for collaborating with Akron Community Foundation to benefit our community in your overall philanthropy and estate plan:
Leave a Bequest to a Board Discretionary Fund
Major advantages of working with Akron Community Foundation include its perpetual structure, community-based governance, and commitment to addressing needs as they change. A board discretionary fund allows you and your family to provide support that evolves over time as priorities in the region shift. The community foundation's mission is to thoroughly understand the community and improve lives within it. Akron Community Foundation's board and staff conduct ongoing, extensive research about the needs of the community and the nonprofit programs that are addressing those needs. By leaving a bequest to create a board discretionary fund in your name, you are investing in the community foundation to support programs that are addressing the community's most pressing needs, as well as needs that can't be identified until the future.
Establish a Field-of-Interest Fund
A field-of-interest fund is an ideal way to target your giving to specific areas of community need (such as education, health, environment, or the arts). Your field-of-interest fund at Akron Community Foundation establishes parameters for grantmaking according to your wishes. The community foundation's staff follow these parameters and utilize our expertise to make grants that align with your intentions. Your fund can continue beyond your lifetime and for multiple generations, consistently providing grants to support your area of interest according to the terms you established when you first created the fund.
Establish a Designated Fund
A designated fund at Akron Community Foundation can help you secure your favorite organizations' financial futures so that their missions continue, uninterrupted, even in the face of challenges. Designated funds are almost always endowed, meaning only the interest from the fund is distributed to charity, while the principal is invested and grown over time. This allows you to sustain a nonprofit's charitable mission both during your lifetime and long after you're gone.
And here's a bonus! If you plan to give to a board discretionary fund, designated fund, or field-of-interest fund at the community foundation during your lifetime, and you're over the age of 70 1/2, you can direct up to $105,000* each year from your IRA to the fund. This is called a Qualified Charitable Distribution, or "QCD." Not only do QCD transfers count toward satisfying your Required Minimum Distributions if you've reached that age threshold, but you also avoid the income tax on those funds. Furthermore, the assets distributed through a QCD are no longer part of your estate upon your death, so you can avoid estate taxes, too.
*Note: Beginning in 2024, the annual per-taxpayer QCD cap will be indexed for inflation, which will allow taxpayers to give even more from their IRAs directly to charity in future years.
To learn more, contact Laura Lederer at 330-436-5611 or llederer@akroncf.org. We're always available to answer your questions about philanthropy or to schedule a personal consultation with you and your professional advisors – all at no cost.
Additional Resources
This article is not intended as legal, accounting, or financial planning advice.