CHARITABLE GIVING
Giving to charity can help more than your community. It’s a win-win. It can also save you on taxes.
Why give to charity:
- Leave a legacy
- Essential to organizations
- Integrating charitable giving into your estate plan can also provide meaningful tax relief for your estate.
You can make a gift of cash, donate mutual funds, securities or life insurance. Charities are accustomed to receiving gifts and are well-equipped to handle those transactions.
There are many ways to give and lots of potential tax savings:
Simple cash gifts will result in getting the charitable tax credit. For example, the first-time donor’s super credit provides an additional 25% non-refundable tax credit. In addition, if you bequest the gift through your will, you can receive a tax credit of up to 100% of the net income for the year of death and carryback for the year preceding death.
By integrating donations through your estate plan, you can also give stocks, mutual funds or bonds. This is not only a great way to donate to charity, but it also eliminates capital gains taxation and provides your estate a donation receipt for the fair market value of the shares. Depending on your situation, this could provide significant tax savings for your estate.
When gifting life insurance to a charity, there are various ways you can structure life insurance. For example, you can give an existing life insurance policy, a new insurance policy, or a life insurance death benefit. Each structure provides a different charitable donation receipt amount. We can discuss what makes the most sense for your situation.
Whether you’re motivated to give or reduce your tax bill, the benefit to a charity is the same. Your choice of donation method – and why you choose it – is up to you.
To learn more about charitable giving, please contact us.