The Planned Giving Primer with Marilyn Piccini-Roy
Issue #:
3Volume #:
801/07/2008
Marilyn Piccini Roy, a member of the McGill University Health Centre Foundation’s Planned Giving Committee, is a partner in the Wealth Management Group at Borden Ladner Gervais. In this edition of the Planned Giving Primer, she explains the advantages of making a charitable bequest and demonstrates how, through your will, you can provide a better future for more than just your heirs.
What is a charitable bequest? A bequest is a gift made through a will and may include cash, securities, closely held stock, real estate or tangible per-sonal property. A bequest, one of the most common types of planned gifts we receive at the McGill University Health Cen-tre Foundation, allows donors to make a much larger gift than they might have been able to make during their lifetime.
Are there different ways of leaving a charitable bequest?
Indeed there are. The most straightforward way to make a charitable bequest is to designate a fixed dollar amount or spe-cific property from your estate. You can also choose to designate a percentage of your estate to the MUHC Foundation. This has the advantage of allowing the amount of the gift to adjust as the value of your estate changes. Another option is to set up a charitable remainder trust and name someone, perhaps your spouse, as the beneficiary. In this scenario, your spouse would receive the income of the trust during his or her lifetime. Upon your spouse’s death, the remainder of the trust would go to the charity specified in your will.
How will I benefit from making a charitable bequest?
In addition to supporting a cause close to your heart, your estate will receive certain tax benefits from your gift to the MUHC Foundation. When your bequest takes effect upon your death, a tax credit will be issued in the amount of that be-quest and can be applied against income tax payable. Your estate may be entitled to claim gifts in the year of death equal to 100 percent of your net income in that year and the preceding year. For example, if your income in the year of death was $200,000 and you left a bequest in the same amount, there would be no income tax to pay from your estate.
Non-cash bequests also afford additional tax advantages, for example:
- a legacy of publicly listed securities eliminates any capital gains tax
- a legacy of a RRIF or RRSP eliminates taxes on the proceeds
- a legacy of real estate or art may provide a tax credit and a reduction in capital gains tax
In what ways can a charitable bequest be used?
As with any gift to the MUHC Foundation, a bequest can be directed to whatever area is most meaningful to you. You can direct your gift to a certain department or program of the hospital, such as Cancer Care or Women’s Health, or you can specify that your donation be applied to the hospital’s greatest needs.
How do I go about making a bequest to the MUHC Foundation?
If you already work with an estate planner, just let them know that you are interested in leaving a charitable bequest to the MUHC Foundation. The MUHC Foundation can also provide financial experts to advise you. For more on bequests, please contact us by phone at 514-931-5656.
