Calling it splits: What happens to charitable assets in a divorce?

As you work with charitable clients over the course of your career, you will likely help dozens of married couples establish donor-advised funds and other types of funds at Kitsap Community Foundation. You may help them structure charitable gifts in wills and trusts, establish charitable remainder trusts, and everything in between.

But what happens to those charitable assets in the event of divorce? Over the last few years, in the wake of high-profile divorces, more and more advisors have been pondering this question. It is certainly worth considering so you can be prepared if, and likely when, you encounter such a situation.

This is especially important as women play an increasingly prominent role in a couple’s philanthropy.

Why Collaborative Philanthropy Matters

For many couples, philanthropy is deeply personal and closely tied to shared values developed over time. What’s more, advisors who engage both partners on all planning matters, including charitable giving, are more likely to grow their practices and earn client referrals. This is supported by research described in a recent white paper regarding the philanthropic conversation.

The Legal Framework of Charitable Assets

From a legal standpoint, charitable giving during marriage is often subject to the same rules that govern other marital assets.

In community property states like Washington, for example, assets acquired during marriage are generally considered jointly owned, and spouses owe fiduciary duties to one another regarding the use of those assets.

That framework can create complications when one spouse makes a significant charitable gift without the other's knowledge or consent. Indeed, unilateral gifts of community property may be challenged, and in some cases, the full value of the gift may be attributed back to the donating spouse in a divorce proceeding. This may be a surprising outcome for clients who assume that charitable intent alone resolves any questions about ownership or control.

Navigating Control and Governance

The implications extend beyond outright gifts. Philanthropic vehicles such as donor-advised funds, private foundations, and charitable trusts can also become points of negotiation in divorce. These structures may no longer be considered part of the marital estate once funded, but questions about control, governance, and ongoing advisory privileges can still create tension between spouses.

For attorneys, CPAs, and financial advisors, the takeaway is clear: charitable planning does not exist in a vacuum. Conversations about significant gifts, especially those made during marriage, should include coordination with legal counsel and, where appropriate, documentation of mutual intent. Encouraging clients to align on charitable decisions in advance can help avoid disputes later and preserve both financial and philanthropic goals.

Kitsap Community Foundation Is Your Resource

As always, remember that we are here for you!

Whether a client is considering a current gift, establishing a charitable vehicle, or navigating a complex life transition such as divorce, we can serve as a resource to help implement the recommendations of legal and tax counsel in a way that is both effective and durable.

Anytime you are talking with a client about charitable giving, give us a call! Including us early in the conversation can help ensure that your clients’ charitable intentions are carried out smoothly, even when circumstances change.

We look forward to working together to support our community and your clients' legacies.