Legal: Thanksgiving

You may be thinking of others less fortunate than yourself who need help and support – and of how you might best give back to your community, a favourite charity or cause. If so, you're far from alone. As Canadians, we have a long and proud tradition of taking positive action for the common good. Each day of each year, hundreds of thousands of us provide vital volunteer support for the many charitable and other non-profit organizations that would otherwise be unable to carry out their good works. And for many Canadians, that support goes beyond volunteerism to charitable giving, either while we live or as a legacy provision in our Wills.

If charitable giving is on your mind, here are some strategies for leaving the legacy you wish to the charity of your choice and to your heirs with minimum taxation, fees or other delays:

Name the charity as beneficiary

Leave a bequest in your Will to a recognized charity and your estate will receive a charitable donation tax receipt that could eliminate all of the income tax on your final tax return and possibly on the return for the immediately preceding year, as well.

Establish a Donor Advised Fund

As the donor, you receive an immediate tax receipt for all contributions made to the donor-advised fund and you also retain the right to advise on how the fund's income (usually called grants) is to be allocated to charity each year – all without the administrative responsibilities or costs associated with establishing a private foundation.

Establish a Charitable Remainder Trust

You donate your capital while you live on the income. The charity has no access to trust capital during your lifetime and all interest and dividends are paid to you as taxable income. Upon your death, the trust assets – known as the remainder – go immediately to the charity. You receive an immediate tax receipt for the “remainder interest” given to the charity by creating the trust.

Donate a life insurance policy now

When you donate a life insurance policy to your favourite charity, it will receive the total death benefit under the policy and you will enjoy certain tax credits.

Establish a Charitable Life Annuity

By making a charitable gift now you will continue to receive a lifetime income from the assets you've donated, for yourself, or for you and your spouse and receive certain tax credits.

Donate publicly traded stocks or securities

Recent tax law revisions have reduced the capital gains tax on gifts of appreciated stocks and securities from 25% to zero – when they are donated to a recognized charity. You or your estate will pay no capital gains tax on donated shares and will receive a tax receipt for their full value.

Establish a Private Foundation

Your foundation will ensure your generosity lives on and can permanently associate your name or your family's name with the causes you've chosen.

If charitable giving is in your future, talk to your financial advisor about the charitable giving strategy that makes the most sense for you, your charity and your estate.

(Submitted by Damon Smith, Investors Group Financial Services Inc.) For more information call 1.888.335.1362.

This column, written and published by Investors Group Financial Services Inc.(in Quebec – a Financial Services Firm), is presented as a general source of information only and is not intended as a solicitation to buy or sell investments, nor is it intended to provide professional advice including, without limitation, investment, financial, legal, accounting or tax advice. For more information on this topic or on any other investment or financial matters, please contact your Investors Group Consultant. Insurance products and services are distributed by I.G. Insurance Services Inc. (in Quebec – a Financial Services Firm). Insurance licence sponsored by The Great-West Life Assurance Company outside of Quebec.

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