During our August nonprofit workshop, our nonprofit team shared the latest in accounting and tax updates, as well as insights from AICPA’s recently revised Audit & Accounting Guide for Not-for-Profit Entities. We posed various questions during our workshop and over the next few blog postings, we will share the answers to those questions.
Q. Is a bequest receivable time restricted?
A. As always, the particular facts and circumstances need to be considered, but absent any purpose restrictions placed by the testator, it is reasonable to consider a bequest receivable as unrestricted. This is because restrictions can only be placed by donors, and the delays between clearing probate and payment are administrative dealings of the courts and attorneys, not a function of a time restriction placed by a donor.
Reminder: Being named as a beneficiary in a will is an intention to give, not a promise to give, since individuals retain the right to modify their wills during their lifetime.