People With Big Estates Leave Little to Charity

Wealthy people whose estates are large enough to be subject to estate taxes leave only a fraction of their assets to charity.

According to estate-tax returns filed in 1998, 6.2 percent of total estate value was distributed

in the form of charitable bequests, compared with 8.8 percent for 1997 and 6.3 percent for 1989, Internal Revenue Service data show.

Estate taxes currently are levied on estates valued at $675,000 or more, a threshold that is scheduled to rise in increments to $1-million by 2006.

Most people who die with large estates do not leave anything to non-profit organizations. Only 17.4 percent of Americans whose estates were large enough to file an estate-tax return in 1998 made charitable bequests.

In 1998, bequests from all estates that were large enough to require an estate-tax return totaled $10.9-billion, about 6 percent of all charitable donations made by individuals, foundations, and corporations that year. The average bequest was $640,000.

Size of Bequest

But the larger the estate, the greater the likelihood that it included a charitable bequest. About half of the 446 tax returns for estates valued at $20-million or more included such bequests, I.R.S. data show. Thirty-nine percent of the 944 estates valued at $10-million to $20-million included bequests to charity, while only 14 percent of the 49,705 estates valued at $600,000 to $1-million did so.

According to estate-tax returns filed for people who died in 1995, fewer males made charitable bequests than did females, and men gave a smaller portion of their net worth to charity than did women. The I.R.S. reported that an estimated 5,734 males, or 13.4 percent of males for whom an estate-tax return was filed, made charitable bequests that totaled $5.1-billion, or 27 percent of their net worth.

Among females, 8,549, or 24 percent, made charitable bequests that totaled $5-billion, or 29 percent of their net worth.

Single people who die with enough wealth to incur the estate tax are more likely to leave bequests to charity than those who are married, widowed, separated, or divorced.

“Only 6.9 percent of married males and 9.1 percent of married females included charities among their beneficiaries,” according to returns filed for people who died in 1995, the I.R.S. noted.

“This finding supports other research which found that marriage has a negative effect on charitable bequests,” since married people who die with taxable estates “tend to substitute bequests to spouses and children for charitable gifts.”