Glossary

Appreciated Property
Assets, such as real estate or securities, which have increased in value from their cost basis.
Beneficiary
The person and/or organization named in a will, trust or other legal document to receive an interest in an estate.
Bequest
A gift of property or assets to an individual or organization as defined in a will.
Charitable Income Tax Deduction
The portion of a gift that is deductible from a person’s federal, gift, or estate tax.
Charitable Gift Annuity
An agreement between a donor and the charity that pays an annual fixed income for life (for one or two recipients) in exchange for cash, securities or other tangible property. An annuity generates immediate charitable income tax deduction.  Capital gains are significantly reduced and can be reported over a number of years so that the taxes are not all due at one time.
Charitable Lead Trust (Charitable Income Trust)
A trust in which the income interest is paid to a charity and the remainder interest either reverts to the grantor or is paid to a non-charitable beneficiary at the termination of the trust. Conceptually, a charitable lead trust is the opposite of a charitable remainder trust where the non-charitable beneficiary receives the income interest and the charitable beneficiary receives the remainder interest. Charitable lead trusts can a valuable planning tool for the charitably-inclined client when making multi-generational transfers.
Charitable Trust
A trust having a charitable organization as a beneficiary.  Examples include: charitable lead trust, charitable remainder unitrust, and charitable remainder annuity trust.
Codicil
An addition or amendment to a will.
Cost Basis
The donor’s purchase price of an asset.
Estate Tax
Tax assessed at one's death on the transfer of most types of assets.
Executor/Personal Representative
The person named in a will who carries out the terms of the estate.
Fair Market Value
The price an asset would bring on the open market.
Gift Tax
The tax levied on gifts on non-charitable beneficiaries. Currently, an individual can give away $13,000 annually to any number of individuals without being subject to gift tax. Transfers over and above the $13,000 may be subject to gift tax.
Income Interest
The right to receive payments from a trust for life or a term of years.
Intestate
Dying without a will.
Life Income Gift
A planned gift that makes payments to a donor and/or other beneficiaries for life or a term of years and then distributes the remainder to a charitable organization(s).
Living Trust
A document with which the donor directs the transfer of his/her assets upon his/her death.  It allows for assets to pass outside of the probate process, can continue after the donor’s death, and is revocable at any time.

Living Will
A living will is a legal document that a person uses to make known his or her wishes regarding life prolonging medical treatments. It can also be referred to as an advance directive, health care directive, or a physician's directive. A living will should not be confused with a living trust.
Long-Term Assets
Any asset that is held for longer than a year.
Probate
The court process for determining the validity of a deceased person’s will and ensuring all property is distributed in accordance with the terms of the will.
Remainder Interest
The amount remaining in a trust after income payments have ended.
Retained Life Estate
The transfer of a remainder interest in a personal residence, farm, or vacation home, with the agreement that the donor may occupy the property until death or relinquishment of property by the donor or person acting with power of attorney.
Split-Interest Gift
Any gift in which a portion is assigned to a charity and portion to the donor or his/her designee. Charitable gift annuities, pooled income funds, and charitable remainder trusts are all variations of split-interest gifts.
Testator
The person making the will or testament.
Testate
Dying with a valid will.
Trust
A legal instrument created by a person for the benefit of him or herself during life and others during life or upon death.
Trustee
The individual or organization entrusted with the responsibility of managing all assets placed in a trust.
Will
A legally executed document that directs how and to whom a person’s property is to be distributed after death.