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Bequests

Nineteen years ago, Michael founded a software company that has become an industry leader. Although he is active with his local hospital and arts council, Cato is Michael’s first love. The sudden loss of his wife left him thinking about the future: after making generous provisions in his will for his children, Michael decided to leave Cato an unrestricted bequest of $2,000,000. He opted for an “unrestricted” bequest because it will permit Cato to use his bequest wherever it is most needed. Michael is also pleased to learn that his estate will get a $2,000,000 estate tax deduction.

Another simple, commonly used method to ensure Cato’s legacy is naming the Cato Institute as a beneficiary in your will. You can do this in one of three ways:

  1. You can leave Cato a specific amount of cash or specific assets.
    Example:
    “I give the sum of $100,000 to the Cato Institute,” or “I give 500 shares of XYZ Corporation stock to the Cato Institute.”
  2. You can leave Cato a fixed percentage of your estate.
    Example:
    “I give 30 percent of the residue of my estate to the Cato Institute.”
  3. You can leave Cato all or part of the residue of the estate after bequests to other beneficiaries have been made.
    Example:
    “I give the residue of my real and personal estate to the Cato Institute.”

Whichever method is chosen, if properly structured your bequest will be fully deductible from your estate, thus decreasing any tax liability. The estate tax charitable deduction is unlimited. Since only large estates are subject to the estate tax, the estate tax charitable deduction may not be of use in all situations.

Cato welcomes both unrestricted and restricted bequests: an unrestricted bequest allows Cato to determine the best use for your gift, whereas a restricted bequest lets you make the choice. For example, your restricted bequest could support the work of a particular Cato Center or program at Cato—or provide scholarships for Cato University.

If you already have a will and you wish to make a bequest to the Cato Institute without rewriting the entire document, a codicil can be drawn to accomplish this purpose.

If you have elected a living trust rather than a will, you can also easily include the Cato Institute as trust beneficiary, similar to a bequest under a will.