The Benefits of including a charitable gift in your Will
Estates & Trust Lawyer
Clark Wilson LLP
With all that is going on in the world, you may not be surprised to learn of a surge of people looking to update their estate plans or create a Will for the first time. If you have made a mental note to fix your Will, let this be the push you need to put your thoughts into action. If you have not already, I encourage you to include charitable giving in your estate plan.
There are tax advantages for making charitable gifts. It may be possible to leave more money to your loved ones if a large tax liability is offset with a well-planned charitable deduction. The sense of pride in supporting a meaningful cause is perhaps even more valuable.
If you do not know which charities you want to support, think about the causes that have had a meaningful impact on your life. Consider organizations that support health care, animals, the arts, nature, education or those less fortunate – all are worthy and need support.
Whether or not you already support charities, you likely wish that you were able to be more generous. No matter your financial circumstances, you can make a significant impact – you can’t take the money with you, after all!
There are many ways to include charitable giving in your estate plan. The most common is a bequest in your Will. You can give a fixed amount of money, an asset such as artwork or a percentage of your estate. If your Will has to be probated in British Columbia, a fee of 1.4% of your estate will be owed, and it could take a year or more for the charity to receive your gift.
You can also designate a charity as a beneficiary of registered accounts (TFSAs, RRSPs) and life insurance policies. This bypasses probate, avoids the 1.4% fee and allows the charity to receive your gift faster. Speak to your lawyer and other professional advisors first to maximize the tax benefits and impact of your gift.
Contact your charities of choice to advise of your planned gift and to ask if there are any requirements (some charities cannot accept physical assets).
Be sure to discuss your charitable gift with your family – they may be inspired by your generosity.
Creating or updating your estate plan can give you some sense of control in these unstable times; most people report a sense of relief once they finally get it done. Amplify those good feelings with a generous gift to a worthy cause.