Protecting Donor Restrictions on Bequests

Ellen Lippman, PhD, CPA, and Teri Grimmer, CPA, CGMA

A recent CPA Journal article “Assisting Individuals with Charitable Legacies” (Sidney Kess and Edward Mendlowitz, April 2016, http://bit.ly/2nmSxfx) describes different ways donors may structure bequests. The authors state that CPAs can assist in helping the donors determine the best vehicle for the bequest; however, one factor not discussed is consideration of gifts that include donor restrictions. While care should be exercised when establishing the trust or other vehicle for the bequest, additional consideration is necessary for protecting a restricted bequest, as the person most interested in maintaining the restriction is usually no longer alive to monitor that provision.