Wills, Trusts & Estates Prof Blog

Editor: Gerry W. Beyer
Texas Tech Univ. School of Law

Wednesday, September 26, 2018

Why Wealthy People Give to Charity During Life, but Not so Often at Death

GiveThe Urban Institute's recent study found that the vast majority of ultra-wealthy people donate to charity during their lifetimes rather than making a charitable donation at death. But those that choose to donate after death usually contribute a larger amount than they did in previous years.

The study of predates the the "Giving Pledge," which consists of 200 of the world's wealthiest individuals with hopes that they will donate the majority of their wealth to charity. Researchers used  estate tax returns matched to income tax returns to analyze charitable giving by wealthy individuals at the time of their death compared with giving over their last five years of life. The sample comprised people with wealth ranging from $2 million to well upward of $100 million.

The analysis showed that most top wealth holders, no matter their marital status, were much likelier to give during their last years of life than at death. One explanation may be that health concerns are a top priority for high worth individuals, and another explanation could be that taxpayers can quickly consume any income-tax charitable deduction by giving away modest shares of their wealth.

Urban Institute said that however one rates the above explanations, the analysis shows that many people pay too little attention to the potential charitable opportunities their wealth provides.

See Michael Fischer, Why Wealthy People Give to Charity During Life, but Not so Often at Death, Think Advisor, September 24, 2018.

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.) for bringing this article to my attention.


Current Affairs, Estate Planning - Generally, Estate Tax, Income Tax | Permalink


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