Charitable GivingA client letter on including charities in your will or trust

Robert E. Williams, Attorney at Law

President Jimmy Carter was awarded the Nobel Peace Prize for promoting democracy and fighting poverty and disease. He was asked by the committee which awarded the prize to discuss this question: What is the greatest challenge that the world faces? Think for a moment as to how you might answer that question. Would you say it was hunger, famine and starvation, easily curable illnesses ranging from Guinea worm to diarrhea to HIV/AIDS to pathogens such as Ebola and Zika? Perhaps you would say war?

This is what President Carter said in his 2002 speech:

“Among all the possible choices, I decided that the most serious and universal problem is the growing chasm between the richest and poorest people on earth. Citizens of the two wealthiest countries are now seventy-five times richer than those who live in the ten poorest ones! And the separation is increasing every year, not only between nations, but also within them.” [1]

Richard Stearns, President of World Vision has noted in his book “The Hole in Our Gospel”, what is most astonishing is not what President Carter did choose but rather what he did not choose. He did not cite poverty itself but the disparity between the rich and the poor.

Even in the United States the inequality is rising. “Time” magazine reports in its November 2011 issue that the wealthiest 1% of our citizens take home 21% of our country’s income and account for 35% of its wealth. As an example of this, “Time” reports that in the 1970’s corporate CEO’s earned about 40 times as much as their lowest paid workers – “Now they earn more than 400 times as much”.

Although there is no question that government policies (tax and otherwise) can address this widening gap, so can we each as private citizens help in our charitable giving, both during our lifetimes and upon our deaths. Whatever one’s political views may be, we are all concerned about the future of this planet for our children’s and grandchildren’s generation and their progeny.

Research shows that unequal societies have lower levels of trust, higher levels of anxiety and more illness. Furthermore, the International Monetary Fund reports that unequal countries are more prone to boom – and – bust cycles and are ultimately at risk for social instability.

Stearns points out that if we were all rich, or at least comfortable, as the vast majority of my acquaintances are, this would not be a problem, and if we were all poor, no one would be in a position to help. But when some of the world is so wealthy that what they (we) spend on pet food each year would solve the world hunger problem, there is something wrong. Many of the world’s poor are “living” on $2.00/day.

I have witnessed this stark contrast in Nairobi, Kenya, where I had the “privilege” of living in an orphanage for a month. When one walks in the slums of Nairobi one can see this stark contrast by just a slight movement of the head. Looking down you can see children playing in the open sewers which run down the middle of the dirt “street” and men making “chonga”, combining water from a polluted stream with battery acid! – by simply looking up past the rusty metal shanty’s you will see beautiful gated condominiums with glass skyscrapers in the further background. This was a very moving sight.

President Carter ended his speech with these words:

"But tragically, in the industrialized world, there is a terrible absence of understanding or concern about those who are enduring lives of despair and hopelessness. We have not yet made the commitment to share with others an appreciable part of our excessive wealth. This is a particularly rewarding burden that we should all be willing to assume."

In my 40 plus years of practicing law, I have prepared hundreds of estate plans and administered hundreds of decedent’s estates. I have assisted in the transfer of tens of millions of dollars from my parent’s generation to my generation, but I have seen only a small portion of this transfer pass to charitable organizations and even smaller portions to organizations that help the poor.

Our common response is to ignore the poor. I was riding the Greyhound bus from Salinas to Santa Barbara a few years ago and found myself privileged to be sitting next to a homeless gentleman. I sat down next to him by choice. I will never forget his response to my question of how we could best help the homeless. He did not say “give us money” or “buy us a meal” or “build more homeless shelters”. He said “when you pass us in the street, just, please, acknowledge that we exist! Don’t turn your head away, as most do, but greet us, smile and make eye contact just like you would when you pass a non-homeless person on the sidewalk”.

George Bernard Shaw is quoted as saying that the worst sin towards our fellow creature is not to hate them, but to be indifferent to them; that’s the essence of humanity. I have heard people quote Jesus as saying “the poor you will always have with you” (Matthew 26:11, Mark 14:7) as justification for doing very little to help. Jesus did say that when the disciples complained that the perfume which a woman poured on his head could have been sold and the money given to the poor as quoted in the Gospel of Mark. He follows up by saying, “whenever you wish you can do good to them (the poor), but you do not always have me with you.”

The question for us today is “when do you wish?” Perhaps some help could be forthcoming in our estate plans. God spoke the following words through Moses:

“There will always be poor people in the land. Therefore, I command you to be openhanded toward your brother and toward the poor and needy in your land.” (Deut. 15:11)

I feel very strongly that it is my responsibility to at least address this issue with each of my clients. Many of us have not given it much thought. Most of us are not wealthy, at least in our own eyes. Some know that they are. But nearly all are wealthy in comparison with the rest of the world.

I recently came across a great quote from the book "Dirty Faith" by David Nowell, President
of Hope Unlimited for Children: "He was born on third base - and thought he hit a triple."
This should cause us who have been privileged to have been born or to live in this country
not only to be thankful to those who have gone before but also to think seriously about our responsibilities toward future generations here and around the world.

In his second letter to the Corinthian church, the Apostle Paul writes:

“Of course, I don’t mean your giving should make life easy for others and hard for yourselves. I only mean that there should be some equality. Right now you have plenty and can help those who are in need. Later, they will have plenty and can share with you when you need it. In this way, things will be equal….” (II Cor. 8:13-15)

I am quite certain that most all of us give to the needy, at least to some extent, and in various ways. During our lives we give of our time, talents and treasure, but I would ask you to consider a further gift in your will or trust to those causes that you are supporting now. I know firsthand what a real boost it is to a charity, especially a small or local one, to receive a gift in someone’s will or trust. I also believe that when we are nearing the end of our lives, it will give us a good feeling inside to know that a portion of our estate will go to help those whose needs are so much greater even than our loved ones – remember the difference between 90% or 95% as opposed to 100% to be received by our loved ones will not make that much difference in any of their lives. However, the difference of 10% or 5% rather than 0% can make a big difference to a deserving charity.

Thank you for reading this letter and giving it your thoughtful consideration.

Very truly yours,

Robert E. Williams

[1] compare that according to Jeffrey Sachs in 1820 the difference in per capita income between the wealthiest region of the world and the poorest was perhaps four to one.

Practical Ways to Include Charitable Giving in Your Estate Plan

The letter above explains why giving matters. The options below explain how a gift can be built into a California estate plan. Each can be sized to fit your family's needs, whether that is a modest percentage or a larger legacy gift.

A bequest in your will or living trust

The simplest approach is a provision in your will or revocable living trust leaving a dollar amount, a specific asset or a percentage of your estate to one or more charities. A percentage gift, such as the 5% or 10% mentioned in the letter, adjusts automatically as your estate changes. Use each charity's full legal name and tax identification number so the gift reaches the right organization.

Naming a charity as beneficiary of a retirement account

Traditional IRAs and 401(k)s are often the most tax-efficient assets to leave to charity. Family members who inherit these accounts pay income tax on withdrawals; a qualified charity does not. Changing a beneficiary designation form is usually all that is required.

Qualified charitable distributions during retirement

If you are age 70½ or older, you can direct your IRA custodian to send up to $111,000 (the 2026 limit) directly to qualified charities. The distribution is excluded from your taxable income and can count toward your required minimum distribution.

Charitable remainder trusts and gift annuities

A charitable remainder trust can pay you income for life and then pass the remaining assets to charity, while providing an income tax deduction and a way to sell appreciated property without immediate capital gains tax. A charitable gift annuity offers a simpler, fixed lifetime payment. Read more in Charitable Remainder Trusts and Other Planned Giving Tools.

Donor-advised funds and gifts to local organizations

A donor-advised fund lets you contribute now and recommend grants over time. Gifts can also go directly to local churches, ministries, schools and community organizations. Those wishing to create a new charitable organization can read How to Start a Nonprofit in California.

A note on 2026 tax rules

Beginning with 2026 tax years, people who take the standard deduction may deduct up to $1,000 (single) or $2,000 (married filing jointly) of cash gifts to public charities, while itemizers face a new floor equal to 0.5% of adjusted gross income. Tax rules change often, so confirm the current law with a tax adviser before making a large gift. For gifts to family members, see Lifetime Gifts to Family: Annual Exclusion and Gift Tax Rules for 2026.

The letter above is reproduced as originally written; dates and figures in it (such as President Carter's 2002 Nobel lecture and the 2011 magazine report) reflect the sources quoted at the time.