Some considerations when gifting to Charities in your Will
Last week I read an interesting blog posted by @allaboutestates and written by Yvonne Mazurak, Associate at Fasken LLP. It was called An Introduction and Some Reminders about Charitable Gifts.
The article mentioned something so true - ¨Many Canadians plan to make their largest charitable gifts in their Wills¨, then went on to make some very helpful reminders regarding charitable gifting in your Will:
Use the proper legal name – Though it may sound obvious, the use of an incorrect name is a frequent, albeit easily avoided, issue. The intended charity’s name might resemble that of another, or it might have multiple branches/chapters. Also, consider including other identifying characteristics, such as a registered charity number.
Provide a backup plan – Most major charities might be household names today, however, some could nevertheless one day cease to exist. While the court has inherent jurisdiction–under the cy-près doctrine–to direct funds intended for a charity that no longer exists at the time of the testator’s death to another charitable purpose within the settlor’s general intention, the need for such an order could be avoided with a “gift over” provision.
Consider non-cash gifts – A charitable gift can take many forms other than cash, such as shares, life insurance, RRSP or RRIF proceeds. Charitable gifts of certain assets are given favourable tax treatment, such as gifts of shares in specified publicly-traded companies for which, subject to certain conditions, the inclusion rate of any realized capital gain is reduced to zero.
These are such important reminders! I would also add the following few:
Do not underestimate the impact of even a small portion of your estate - It is a misconception to think that you must choose between supporting your loved ones and supporting the causes you care about. You can do both! And it doesn’t have to be complicated. Several charities are now set-up to ensure that your gift (even a small one) will have a lasting impact on their cause - one that is important to you!
There is a Charity for that! No matter what is important to you (healthcare and research, humanity and inclusion, animals, wildlife preservation, poverty, mental health, education, arts, sports, science, human rights, etc…) - there is a Charity for that! You do not need to limit your support and gifts to popular charities just because everyone else is doing it. There is a large bundle of charities out there - and you can certainly find one (or more) that will touch your heart. Consider browsing through a list of charities like the one on the Will Power website for instance.
Giving as a learned behaviour - In my opinion, it is important to talk to your loved ones about causes and charities that are important to you - that you support and want to continue to support through legacy giving. However, never underestimate the impact of your giving behaviour on loved ones and the community in general without saying a single word to them. You may not be able to gift away your ¨giving behaviours¨ or ¨charitable habits¨, but your loved ones may continue to support/donate causes and charities that are important to them based on learned behaviours from you. The very best gift to leave behind!
There are many benefits to making a charitable gift in your Will (income tax benefits, fulfillment, learned behaviour, giving back, supporting the community, etc.). When you are thinking of charity gifting, a good place to start is communicating with an advisor (estate planner, financial planner, estate lawyer, accountant, etc.) to make a plan that makes sense for your personal circumstances.
Charitable gifting does not have to be complex - it just needs to make sense for you and your personal circumstances. At JH Legal Services, charity gifting is a subject we discuss in estate planning meetings and if desired, we will take the time to explain the benefits and walk you through the process.
For more information on charitable gifting in your Will, contact Jessica at jhoule@jhoulelaw.com.
