Estate Planning Glossary

See the below glossary of terms to help assist you with your Estate Planning. 

Actuarial

Refers to the factors used to calculate the value of lifetime payments to individuals or organizations.

Appreciated Property
Securities, real estate, or any other property that has risen in value since the owner acquired it.

Annuity
A contractual arrangement to pay a fixed sum of money to an individual(s) at regular intervals. The charitable gift annuity is a gift to the association that secures fixed lifetime payments to one or two people.

Adjusted Gross Income (AGI)
The total income of a taxpayer on which tax is calculated after certain allowable deductions.

Appraisal
An assessment of the value of a piece of property. Donors contributing real or tangible personal property (art, books, collectibles, etc.) must secure an independent appraisal of the property to substantiate the value they claim as a charitable deduction.

Basis
The owner’s purchase price for an asset, possibly adjusted to reflect subsequent costs or depreciation.

Beneficiary
A person or organization who will benefit from a transfer of property from a will, trust, life insurance policy, etc.

Bequest
A transfer of property or cash to an individual or organization under a will.

Capital Gains Tax
A federal tax on the appreciation in an asset between its purchase and sale prices.

Cost Basis
The owner’s purchase price for an asset, possibly adjusted to reflect subsequent costs or depreciation.

Endowment Fund
A permanent investment fund set up in which regular withdrawals from the invested capital are used for specified purposes.

Estate Tax
A tax levied on the net value of the estate of a deceased person before distribution to heirs.

Executor
The person named in a will to administer the estate (known in some states as the "personal representative").

Fair Market Value
The price that an asset would bring on the open market.

Grantor
The individual transferring property into a trust.

Income Interest
The right to receive payments for a lifetime or a term of years.

Life Income Gift
A gift that makes payments to the donor and/or other beneficiaries for life or a term of years, then distributes the remainder to charity.

Property

Property is divided into two major categories (1) real property and (2) personal property

1. Real Property – Land and generally whatever is built or growing on it.
2. Personal Property – All property other than real estate and categorized as either Intangible or Tangible.
1. Intangible Personal Property – Property that cannot be touched because it has no physical existence (e.g. stocks, mutual funds, patents, claims).
2. Tangible Personal Property – Property that is touchable and has a physical existence (e.g. cars, jewelry, books, machinery, inventory).
1. Personal Effects – A subcategory of tangible personal property which is directly associated with a person such as clothing, mementos, furniture, electronics, etc. (i.e. your "stuff").

Remainder Interest
The portion of the principal left after the income interest has been paid to the beneficiary(ies).

Remainderman
A person or organization who is entitled to an estate or trust once all expenses have been paid, and all specific bequests distributed.

Testator
The individual making the will.

Trust
A transfer of property by the grantor to the care of an individual or organization.

Trustee
An individual or organization carrying out the wishes of the person who established the trust, paying income to the beneficiaries and preserving the principal for ultimate distribution.

1099-R
The IRS form that we send our life-income gift participants detailing how payments they received from their gifts during the year will be taxed.

Last updated June 18, 2024