LEGACY GIVING Points to ponder before giving By COREEN SOL


Legacy giving may be one of the most important finan- cial decisions of your life. The gift itself is as meaningful to you and your family as it is to the charity and your community.


When it comes to planning your philanthropy, there are considerations to ensure your gift is received as you in- tend; to maximize the tax benefits to you or your estate; and to maximize the benefits to the charity. Here is a list of key items to consider. 1) Bequests: When making a charitable bequest through your will (or an addendum called a codicil) you should contact the intended charitable beneficiary to en- sure that your lawyer has the correct legal name and to see if they require additional information or direction re- garding the use of the funds. Unless you have a strong reason for directing the use of your gift, keep in mind that the time horizon is often lengthy between making your will and the charity ultimately benefiting from your gift. Most often, charities prefer to decide the best use of the funds, as their needs change over time. 2) Search Canada Revenue Agency’s list of registered Canadian charities at http://www.cra-arc.gc.ca/chrts-


gvng/lstngs/menu-eng.html 3) Tax implications of your gift: Individuals can claim up to 75% of their earned income in charitable tax credits while they are alive and may carry unused credits for- ward for up to five tax years. On your terminal tax return, your executor can claim up to 100 percent of your earned income in charitable tax credits and may apply unused credits against your previous year’s tax return. Depending on your income level in both scenarios, it may be more advantageous to make a gift while you are alive. 4) Foundations & Endowments – gifts in perpetuity: You may wish to set up a foundation or endowment fund yourself if your donation is substantial enough and you are in a position administer the required reporting with the assistance of a lawyer and accountant. More often, however, individuals look to existing organi- zations to administer an endowment fund for you. At cer- tain thresholds, you maintain the right to name the fund and its beneficiaries. Contributions can be made all at once or over several years and provide the donor with a charitable tax receipt in the year the contribution is made. 5) Donating securities in-kind: In 2006, a tax incentive was introduced for those wish-


ing to donate securities such as stocks, rights, mutual funds, bonds and others. Instead of selling the securities and donating the proceeds, by donating the securities in- kind, the capital gains triggered at the donation date are eliminated, potentially resulting in substantial savings on your personal income taxes. 6) Capital gifts: From time to time, charities raise funds for capital projects, such as the building of a hos- pice or educational facility.You may wish to apply your gift to such projects and in doing so request a building or room be named after you, your family or a special per- son.These gifts can be made while you are alive or through a bequest in your will and can be made in cash, eligible securities or real estate. 7) Giving life insurance: A unique way to leave a larg- er gift than you may be able to otherwise afford is by naming a charity as the beneficiary of a life insurance policy. Furthermore, if you make the charity the owner of the policy as well as the beneficiary, you may deduct the premiums paid as a charitable tax credit while you are alive.


Coreen T .Sol, CFA, is a portfolio manager with National Bank Financial.


13 THE OKANAGAN SUNDAY, MAY 13, 2012


Devoted to Helping Little Hearts …in our Community


Cops for Kids are dedicated RCMP members and friends that are committed to providing financial assistance to children in medical, physical or traumatic crisis within the Southern Interior Region of British Columbia.


Please consider leaving your legacy to the children in our communities.


www.copsforkids.org 250-801-4438


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