Many people don’t realize donating to charity can take other forms than simply giving a lump sum or monthly contributions.
Publicly Listed Securities – stocks, bonds, mutual fund units, employee stock option shares; Benefits to donor - no capital gains tax. See gift at work today
Life Insurance Policy – whole life or term policy naming charity as owner or irrevocable beneficiary; Donor gets receipt for cash value and future premiums paid – a small current outlay leveraged into a larger future gift.
Interest-free Loan – Provides charity with capital for building or investing. Donor can recover principal, interest not taxable to donor
Bequest of Retirement Plan Accumulations – RRSPs /RRIFs – Donor provides a possible future gift while preserving personal security, receipt offsets tax on distribution of retirement funds.
Bequest by Will – cash securities, real estate, tangible personal property; Donor can give a future gift while retaining full control of property, receives donation receipt with final income tax return; No capital gain tax for listed securities - for other property, 50% of capital gain will be taxable but can be offset by tax credit from charity.
Shares in a Privately Owned Corporation - shares may pay dividends, charity can sell or hold shares; Donor is receipted for appraised market value at time of gift, issued immediately if gift is to a public charity. If gift is made to a public foundation, the donor is receipted when foundation sells the shares.
Real Estate – principle residence, vacation properties, or investment properties; Donors receipted for fair market value, 50% of gain is taxable unless property is donor’s primary residence, then no taxable capital gain. Tax offset by tax credit from charity.
Tangible Property – artwork, furniture, equipment, collections, automobiles, musical instruments, artifacts, certified historic structures; Donor is receipted for fair market value, 50% of gain is taxable but offset by tax credit from donation.
Charitable Remainder Trust – cash, securities and real estate; Donor receives net income from property for life or a term of years; may be receipted for present value of the remainder interest issued at time trust is established; Property is not subject to probate.
Residual Interest in Real Estate or Artwork – principle residence, other real estate, artwork; Donor is able to continue using property for life or term of years, can receive a receipt for present value of residual interest issued at time of gift. Donor avoids tax on a portion of capital gain if they retain life interest. Property is not subject to probate
Annuity (self-insured or reinsured – cash or marketable securities; Charity receives whatever principal remains after making required payments or that portion of the contribution that is retained after purchasing commercial annuity; Donor is guaranteed life payments, all or substantially tax-free, can be receipted for a portion of contribution.
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