Making a planned gift can benefit both you and St. James. The gift is established in the present, with its actual delivery to the charity some time in the future. Through the simple device of a Will, almost anyone can become a special donor. Planned gifts will allow tax savings, some current and others that are realized by your estate. More and more people are including St. James in their estate plans through planned giving. After they ensure that their family is cared for, they want to ensure that The Society continues offering aid and assistance to those who are in need, especially to those bypassed by the normal channels of charitable assistance.
Below are some information about your planned giving options:
- Gifts of Life Insurance
- Wills and Bequests
- Gifts of Shares and Securities
- Charitable Gift Annuities
- Gifts of Residual Interest
- Charitable Remainder Trusts
- Other Planned Gift Options
Our Planned Giving representative can answer any questions you may have and also help to establish the right method of planned giving for you. If you are interested in more information about planned gifts, please feel free to call Andrea Simpson at (604) 606-0356.
Gifts of Life Insurance
Insurance gifts are cost-effective and allow donors the ability to give a larger gift than you may have thought possible. Since February 2000, a charity can be made the beneficiary of a life insurance policy. Upon death, the benefits of that policy can go directly to the charity and your estate receives the resulting charitable tax receipt. In this instance, the proceeds of the life insurance policy avoid your estate and thus avoid probate taxes. There are two ways that you can use a life insurance policy to benefit the work of St. James:
You can use a policy that you presently own and change the ownership and beneficiary to St. James. For premium payments that you make, St. James will provide you with a tax receipt for the full amount. You can also retain ownership and name St. James as a beneficiary. However, in this case, Revenue Canada does not allow a tax receipt to be issued.
You can take out a new policy and make St. James owner and beneficiary or just beneficiary. However, as indicated above, unless St. James is owner of the policy, Revenue Canada will not allow a tax receipt to be issued. The advantages of using a life insurance policy to make a planned gift are:
• You can receive considerable tax benefits;
• You can choose from a full range of products, price ranges, and payment periods to suit your circumstances;
• Your gift is not subject to taxes, probate costs or estate debts;
• You can make a substantial future gift through relatively small monthly, yearly, or single deposits from current income.
Wills and Bequests
A bequest through your Will to St. James can be a tangible expression of appreciation for the services that St. James offers - a gesture that might not be financially possible during your working or retirement years. There are different ways to make a bequest to St. James:
Specific bequest - a gift of a fixed amount of cash or a particular asset;
Percentage share - a gift of a percentage share of the whole estate;
Contingent bequest - a gift that will take effect only in the event of the prior death of other named beneficiaries.
If you are about to have a Will drafted for the first time, or are considering making changes to your current Will, your lawyer can include a bequest to St. James. St. James's Board of Directors suggests the following language for use in your Will:
To pay St. James Community Service Society the sum of $ _____ (or ___% share of my estate) to be used for such purposes of the society as its Board of Directors may from time to time determine.
Charitable gifts made in a Will are deemed made in the year of death. Therefore, the charitable tax credit is received by the estate and can offset any tax owing from the estate. The information you provide is kept entirely confidential. You are not obligated to maintain your bequest should your circumstances or intentions change. A bequest is a revocable gift. You can modify and amend your Will at any time.
Gifts of Shares and Securities
If you are considering making a donation to St. James Community Services Society, you can avoid capital gains tax by donating your securities instead of cash.
Individuals and corporations who donate publicly-traded stocks, mutual funds and segregated funds of life insurance companies do not have to include any portion of the resulting capital gain in their income.
Recent changes to the Income Tax Act have completely eliminated capital gains tax on gifts of publicly traded securities to a public charity. As a result, if you make a gift of publicly listed securities to a registered public charity, like St. James Community Service Society, you will avoid paying any capital gains tax.
In addition, you will receive a charitable tax receipt for the full market value of your publicly listed securities, which you can use to offset other income tax payable. So, making a donation of appreciated stock can be a great way to reduce your taxes owing. For example, making a donation of $1,000 in publicly traded stock can result in a bigger tax receipt than a $1,000 gift of cash if the stock value increased after you bought it.
To donate your publicly listed securities to St. James Community Service Society, please fill out the form.
Please note: St. James Community Service Society must receive the securities in its brokerage account at ScotiaMcLeod before the securities can be valued and a charitable tax receipt issued. The donation amount will be based on the closing price of that day. In addition, any donations in physical certificates must be made negotiable and cleared before it can be sold.
Charitable Gift Annuities
A charitable gift annuity is an irrevocable contract between you and a charity, under which you contribute cash or other property in exchange for a specified, guaranteed, tax-preferred income paid at regular intervals for life.
Who would be interested in purchasing a charitable gift annuity?
It would appeal to individuals who are age 65 plus, who:
• Would like to maximize their current after-tax income;
• Would like to make a current gift to a charity but prefer not to surrender present income.
A charitable gift annuity offers maximum current after-tax income and a current donation to a charity. Depending on age, all or a substantial portion of the annuity payments will be tax-free.
How does it work?
You decide to make a gift of cash or property to St. James. Acting on your behalf, St. James uses a portion of the contribution (normally 70-75%) to arrange for the purchase of a commercial annuity that will pay you the agreed upon income amount at regular intervals. St. James retains the excess and uses it for its charitable purposes as agreed with you, the donor. Your payments are made either directly to you, or to St. James, which in turn pays them to you. St. James sends you a special form (if required) for tax purposes.
Female, age 78, contributes $50,000 for a gift annuity.
• Life expectancy 11.9 years
• Annual payments @ 8.2% = $4,100
• Total expected return = $48,790
• Tax-free portion of payment = 100%
• Donation receipt = $1,210
This example is subject to change according to the rates available.
Gifts of Residual Interest
A gift of residual interest is an arrangement where an item of value is deeded to St. James but the donor retains the use of this property for life or a term of years. The donor is entitled to a tax receipt for the present value of the property at the time the gift is made.
Charitable Remainder Trusts
A charitable remainder trust can be made within the donor's lifetime or established within the Will. Under this type of planned gift, the donor makes a gift to St. James through a trust agreement. If the property generates income, the net will be paid to the named beneficiaries.
Other Planned Gift Options
• Gifts of Real Estate
• RRSP's or RRIF's
• Endowment Funds