Estate planning

Encourage Donors to Ensure Their Beneficiary Designation Forms are Up to Date

Charitable Giving Tip

If you’ve named a charity as the beneficiary of an asset such as an insurance policy or retirement account, you know that the beneficiary designation forms typically request that charity’s name, address and tax identification number (TIN).  

What you might not know is that if any of the information listed on the forms is incorrect—for instance, if the charity has moved and the form lists a previous address—the charity you wish to support might not get your gift!

Case in point: Gayle Union of Marine Heritage recently told us about a donor who named her organization as a beneficiary of his insurance policy. Unfortunately, the beneficiary designation form listed a very old address. The donor passed away in 2020, but to date, his intended gift has not been received—quite likely because any communications sent via U.S. mail would have been returned as undeliverable.

While the probate court or estate attorney should have been able find the nonprofit’s new address with a minimum of effort, there’s no indication they went to the trouble. The nonprofit, meanwhile, is working to ensure their donor’s wishes are honored. And while everyone is hoping for a happy ending, it’s a perfect example of a complication that could have easily been avoided.

(And Thank You Gayle for this story!)

What can you do to avoid similar situations?

Encourage your donors to review all of their estate documents – wills, trusts, beneficiary designation forms, etc. — to ensure that their plans for the distribution of assets to your nonprofit are still accurate.

If they’ve included a gift to your organization, ensure that all documents, especially beneficiary designation forms, include your organization’s current address and TIN.

If any information is outdated, they should complete a new beneficiary designation form to ensure their legacy gift plans can be carried out according to their wishes.

Otherwise, their planned gift might end up in limbo for a long time—or worse, never get distributed at all.

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