Planned giving allows you to provide future support for the organizations that are of the greatest importance to you — and can often allow you to make a larger contribution than you might have thought possible. These gifts ultimately provide a meaningful legacy in your name for the C.D. Howe Institute.
While the various planned gift vehicles provide the donor with definite tax advantages, it is the philanthropic commitment of the donor and his/her relationship with the C.D. Howe Institute that leads to a planned gift. Consistent with other forms of fundraising, planned giving can only be successful if the organization has a focus on building strong, engaging relationships with our donors and prospects.
Significant gifts, such as bequests, require considered planning. Timing and tax considerations are crucial. We’ll work with you, your family and advisers on a confidential basis to ensure your philanthropic goals are met.
Types of Planned Giving:
For additional information on Planned Giving, please contact Duncan Munn at 416-865-1904.
Bequests are the most frequent type of planned gift received by non-charitable organizations. They are gifts and dispositions of property made under a will and directed to a specific beneficiary. Bequests can be designated or undesignated, according to the donor’s wishes and the priorities of C.D. Howe Institute.
Types of Bequests:
- Specific — A distribution of a specific dollar amount or a particular piece of property
- Conditional — A distribution made after other conditions or directions are met
- Residual — A distribution made after other payments, debts and gifts are fulfilled
A bequest can also be subject to a trust. A testamentary trust can be a very useful estate-planning tool when a donor wishes to provide a lifetime income to a named beneficiary, while at the same time providing a substantial gift to C.D. Howe Institute.
Benefits to a Donor:
- Allows the donor to feel confident that they have not only provided for family members but have also left a legacy to a cause that they believe in.
- Entitles their estate to a charitable gift receipt for the full value of the bequest. This can significantly reduce the tax payable when the final income tax return is filled. Their estate may claim gifts in the year of death equal to 100 per cent of their net income in that year and proceeding year.
- Provides the use of their assets during their lifetime.
- Provides flexibilities to designate their gift to a C.D. Howe Institute priority that meets their interest or provide undesignated support to be directed to the greatest area of need.
- Provides flexibility as a bequest is revocable and can be changed if the donor’s financial circumstances change.
Sample Bequest Wording:
The legal name of the C.D. Howe Institute is "C.D. Howe Institute."
- Bequest of Residue (Discretionary)
"All the rest, residue (or share of the residue), and remainder of my estate, both real and personal, I give to the C.D. Howe Institute for its general purposes."
- Bequest of Residue (Designated)
“To pay C.D. Howe Institute the residue (or share of the residue) of my estate for __________ (list specific program area).”
- Specific Bequest (Discretionary)
"I give, devise, and bequeath to the C.D. Howe Institute, the sum of $________(or a description of the specific asset, or ________% of my estate), for the benefit of the C.D. Howe Institute and its general purposes."
- Specific Bequest (Designated)
“To pay C.D. Howe Institute the sum of $______ for ___________(list specific program area).”
As projects to be funded may alter over time in terms of priorities, it is recommended that the following clause be added when the bequest is designated, in order to ensure the usefulness of the donor’s gift:
“In the event that circumstances make the specified use of this bequest no longer practical or desirable, the Board of Directors of C.D. Howe Institute is hereby authorized to make changes in its use while keeping as close as possible to the spirit and general intent of the bequest.”
Charitable Gift Annuities
A charitable gift annuity provides an immediate gift to C.D. Howe Institute while providing a secured income stream for the donor during their lifetime. Depending on the donor’s age, this income can be tax-free. A portion of the total contribution is used to purchase the annuity from a licensed insurance company and the balance is retained as a donation for which a tax receipt is issued.
Benefits to the Donor:
- Tax receipt for the difference between the total gift and the cost of annuity.
- Guaranteed income for life for the donor without investment management worries.
- Annuity rates are typically much higher than the return on guaranteed interest income investment and are fixed for life.
- Avoids probate costs associated with a charitable bequest.
There are three ways a donor can provide a gift of life insurance to C.D. Howe Institute:
- Transfer ownership of an existing policy to C.D. Howe Institute and receive a tax receipt for the net cash surrender value and any premiums paid after the date of the transfer.
- Transfer the ownership of a new policy to C.D. Howe Institute and receive a tax receipt for any premiums paid after the date of transfer.
- Assign C.D. Howe Institute as the beneficiary of one’s own policy, or the life insurance policy from an employer and the donor’s estate will receive a tax receipt equal to the death benefit proceeds paid directly to C.D. Howe Institute.
Benefits to the Donor:
- Donor receives a tax receipt based on the insurance gift type.
- Avoids probate.
- Gift is committed now but made over time.
- Affords the donor the opportunity to make a larger gift than the donor may have thought possible and greater than the sum of the premiums paid.
Charitable Remainder Trust
Donors may establish a Charitable Remainder Trust by irrevocably transferring assets into a trust that is managed by a trustee, either for life or for a period of time. At the end of the trust term, the remainder is distributed to C.D. Howe Institute. In Canada, all Charitable Remainder Trusts are irrevocable.
- The trust document names the interest income beneficiary and names C.D. Howe Institute as the remainder beneficiary.
- The donor receives a receipt based on the net present value of the individual interest, enjoying the interest income from the gifted assets for life or a period of time.
- Charitable remainder trusts can be undesignated or designated.
Gift of Residual Interest
A gift of residual interest is made when a donor transfers property to C.D. Howe Institute now but reserves a life interest in the property.
- Donor has the use of the property during their lifetime.
- Donor receives a donation receipt for the present value of the residual interest.
- Gifts of residual interest can be undesignated or designated.
Benefits to the Donor:
- Use of the property for life.
- Receive a charitable tax receipt for the net present value of the property when the gift is made (net present value is based on the anticipated number of years donor retains interest in the property, current fair market value and appropriate annual discount).
- Claim charitable donations up to 75 per cent of your net income. A five-year carry over on unused donation amounts is permitted.
- Avoids probate. These types of gifts are less susceptible to being contested than a charitable bequest and provide privacy.