Making Charitable Bequests
Published on 29 August 2022, 07:22:56 AM
Write charitable bequests into personal Wills. Axess Law prepares your Will to leave valued possessions and financial assets to registered charities of your choice.
Our Wills and estates lawyers draft a last Will and testament that reflects your final wishes. We make cash gifts or leave a percentage of your estate residue to a charity that will welcome it.
How to Leave Money to Charity in Your Will
Leaving planned gifts in Wills in Ontario is easier when you use an Axess Law Wills and estates professional.
We can leave your entire estate to charity if you wish. Valid Wills that have been approved by a probate court cannot be overturned simply for leaving money to charity in your Will instead of family benefactors.
Best of all, your estate trustee can declare income tax credits of up to 100% of your final income when you die. Charitable gifts significantly reduce estate administration taxes your executor pays or you can get immediate tax relief by making monthly or lump sum gifts during life.
Can Bequests be Revoked?
Bequests in Wills are revocable and can be changed at any time.
Axess Law writes new Wills when your plans change. It’s quicker and easier than drafting a codicil. A validly executed Will is more likely to be upheld in court if its contents are challenged by beneficiaries or third parties not listed in your Will.
Be aware beneficiaries who challenge your Will may contest your intention or capacity to give planned gifts. Being explicit in your Will helps prevent challenges to charitable choices after you pass on. It’s the best way to leave money to charity if you’re concerned about your estate being sued.
What to Leave to Charity
Besides bequests in Wills, you can leave planned gifts of:
- stocks, bonds and other securities
- real estate or REIT units
- annuities
- gifts of cash or investments like RRSPs
- major gifts, such as valuable art or collectibles
- life insurance policies
- or create a private charitable giving foundation.
Five Ways to Give to Charity
1. Giving away your estate residue.
Your estate residue is what’s left over after all your debts are paid and your estate distributed to beneficiaries you named in your Wills.
For instance, Jacques’ modest estate is worth $575,000. He had credit card debts and vehicle loans of $45,000 when he died. He left a small mortgage of $71,000. Jacques’ two children and a family friend receive $350,000 in bequests.
His executor pays estate administration taxes of $7,875:
- $575,000
- Minus the first $50,000, deducted from Ontario estates
- Times $15 per $1,000 of the balance.
Jacque’s executor takes estate trustee fees of $18,000 for his time and effort. He pays a modest $6,125 for accountant’s fees, valuing Jacques’ real property and possessions and Axess Law’s flat fee legal rates. Real estate commissions and other fees to sell his condo cost $20,000.
What’s left is $63,125. Jacques’ Will directs that this be left for heart and stroke research, in memory of his late father.
2. Splitting estate residue between beneficiaries and charity.
Now think how different that would be if Jacques’ final wishes in his last Will and testament were to give 50% of his estate residue to charity and 50% to his beneficiaries. His two children share just over $31,562 between them. The rest goes to medical research.
3. Sharing cash bequests and residue with charities.
Jacques wants to give to more than one charity. Investment and real estate markets are uncertain, so he isn’t quite sure how much his estate will be worth after debts, fees and taxes.
His final Will directs his executor or personal representative to give his favourite animal charity $10,000, a local women’s shelter his wife volunteered at $25,000 and any residue to heart and stroke research.
Happily, his executor can contribute $28,125 to medical research.
4. Giving gifts during life.
Jacques wants the pleasure of seeing his hard-earned money at work before he passes away.
Instead of putting all his bequests in his Will, he donates $25,000 to the women’s shelter while he’s alive. He’s invited to the annual luncheon to hear about the difference his and other donors’ money makes to women and children in need. That’s gratifying for Jacques and the families he’s helping.
His estate trustee distributes the other bequests, which Jacques includes in his Will, after his death — $10,000 to medical care for abandoned animals and $28,125 for research.
Jacques’ generosity benefits charity during and after his life.
5. Making conditional bequests.
Jacques owned a small heritage house in an historic Peel neighbourhood. He instructed his Wills lawyer to leave the home to a local foundation to give historic tours. He thinks the revenues will help the museum.
Before Jacques signs his home over, his son calls the foundation to see if that will be acceptable. They agree. His estate trustee gives the home and $63,125 in cash to the foundation.
That’s not always the case. Axess Law refers you to trust legal partners if you are considering substantial conditional bequests.
Who Accepts Charitable Gifts
Many Ontario charities accept gifts, but not always on terms you may set.
Before instructing Axess Law to include a charitable gift in your Will, check with charities you have chosen about their gift acceptance policies. Your gift may go beyond what a charity is allowed to accept.
Gifts of real estate may be politely refused. A celebrity’s childhood home or historically significant property may seem like a windfall to you. But converting a home to a museum or renting it for events can be more expensive and time consuming than it’s worth.
Why You Need a Lawyer
Making charitable bequests can be easy or complex. Provided a charity is registered with the Canada Revenue Agency, your estate may be eligible for donation tax credits of up to 100% of your final income taxes or other benefits.
Our Wills and estate lawyers can make basic Wills for straightforward bequests, like directing that estate residues be left to specific charities. Or we can write a primary testamentary Will for your other assets and refer you to trusted legal partners for advice on more involved charitable giving options.
Ask us about basic Wills that capture your final wishes. We divide your assets into a primary Will for those that need probating in an Ontario court, like real estate you own in Ontario. If desired, our lawyers for Wills can then draft secondary Wills for corporate-held assets for your business interests. That allows life insurance, investments or private business shares to go directly to your spouse or adult children, without paying estate administration tax.
We make the most of your family and estate resources.
Low Flat Rate Legal Services
Drafting a new Will costs so little with Axess Law’s flat rate legal fees. We can write basic Wills starting at $199.99 each and up — and add a power of attorney for only $50 more (you pay only $249.99 and up for both). Preparing primary and secondary Wills starts at $600 and up.
We draft new Wills if your personal or business life changes to keep your Wills up to date. Divorced, separated, adopting or buying a new business — make a new Will before you fall behind with family or business obligations.
Book Lawyers Online Toronto Area and Ottawa
Axess Law Wills and estates Ontario lawyers meet with you at any of our open law offices in the Greater Toronto Area or Ottawa to make a first Will or write new Wills for charitable bequests.
Use our virtual online lawyer service 7 days a week, anywhere in Ontario. We connect with you using secure, online video conferencing software. Try our easy online booking form to make appointments or ask for a Wills lawyer near you by dialing 1-647-479-0118 (toll free at 1-877-402-4277).
We have onsite parking and easy access to public transit.
