LL0 | November 2009
November 2009 | LL0
A Message from the Premier
A Message from the leader of the official opposition
As Premier of British Columbia, the most important thing I can do with government is to build the foundation for a successful future for our kids and grandkids. We have a responsibility to make the right decisions today to ensure that the generations that follow us have all the same opportunities that we’ve enjoyed.
I believe we all have a responsibility as citizens to contribute to our community.
Whether we share our time, resources, or energy, each of us can make a difference in the lives of others.
LEAVE A LEGACY™ plays an important role in that work. Through education and awareness building. LEAVE A LEGACY™ encourages charitable giving through gifts in wills.
LEAVE A LEGACY™ helps us do just that. It encourages and enables people to leave gifts to charity in their wills. Many already support charitable organizations in their communities. Through LEAVE A LEGACY™, we can extend and enhance our giving beyond our lifetimes. That’s a real gift to the future. I hope you can find the time to read the information in this supplement, and speak to your family about leaving a gift for the future in your will. All of us have a responsibility to think about how what we do today will impact our kids and their kids in the future. Thanks. Sincerely,
This information provides another example of giving back that can impact the future of communities. Sincerely,
Carole James, New Democrat Official Opposition
Gordon Campbell, Premier
A Message from the chair cagp greater vancouver roundtable The Canadian Association of Gift Planners (CAGP) Greater Vancouver Roundtable and its members are pleased to publish this LEAVE A LEGACY™ feature publication. Read on to learn how residents in Metro Vancouver and the Fraser Valley have made a difference in our community by leaving a planned gift for one or more of their favourite charities. A planned gift is a gift made through one’s estate or personal financial plan. Planned gifts are easy to arrange. A good way to start is by seeking professional advice through a professional advisor and/or calling your favourite charity. Both can suggest a variety of planning options that best meet your estate planning needs today and in the future. Founded 17 years ago, CAGP spans the country with 21 regional roundtables and 1255 members. Its purpose is to encourage the development of gift planning by creating awareness, providing educational opportunities and advocating charitable giving. Members of CAGP work with charitable supporters to help them achieve their philanthropic dreams through thoughtful, tax-wise, well-planned giving. In bringing you this supplement, we encourage you to consider the charitable endeavours that are important to you and ask you to think about the legacy you would like to leave to benefit future generations. When it comes to changing lives and helping people in need, the possibilities are endless.
Sarah Leyshon-Hughes Manager, Estate Liaison and Private Committee Services Public Guardian and Trustee of British Columbia
Message from the Chair LEAVE A LEGACY™ Greater Vancouver
LEAVE A LEGACY™ is a public awareness program of the Canadian Association of Gift Planners (CAGP). Its message is twofold — to ensure you have an up-to-date will, and to consider leaving a gift for charity in your will.
The stories inside highlight the positive impact caring donors continue to make to ensure future generations will benefit from the important work of non-profit organizations. Some of the stories provide valuable information from professional advisors and offer important guidelines concerning will preparation, executorship, tax considerations, and concerns for family and friends.
While many people believe one needs to be wealthy to leave a gift for charity through one’s estate, most charitable organizations will tell you otherwise. The majority of legacies they receive are from senior citizens who have worked diligently all their lives and who are comfortable in their retirement. They now wish and are in a position to give back to the community, individuals and organizations that have had a positive impact on their lives. A bequest is their final legacy, and it is often the most significant charitable gift of their lifetime — and the most personally rewarding.
If leaving a legacy interests you, please consider taking the next step. In this feature, you will find a LEAVE A LEGACY™ Partners’ Directory and an Advertisers Index that lists current program supporters. Please feel free to contact these supporters to learn more on how you can make a difference in your community, now and in the future. Kathy Mannas, CFRE Planned Giving Officer The Salvation Army, BC Division
Make a Difference in the Lives that Follow
LL0 | November 2009
November 2009 | LL0
The importance of financial planning in uncertain times By J. Michael Keegan, Senior Wealth Advisor & Associate Director, Wealth Management; Angela Wadsworth, Investment Associate, ScotiaMcLeod The Keegan Group at ScotiaMcLeod
Reviewing your financial plan on a regular basis is an important part of your investment strategy. While a well-designed plan can help you achieve the long-term returns you need and sees you through changing markets, it’s necessary to make periodic adjustments as market conditions warrant, or as your personal circumstances change.
Boosting income. Some investors may have experienced a reduction in income as a result of reduced investment returns. Redeploying some of your assets into highyielding dividend stocks, income trusts, or fixed-income investments can produce new sources of income, while still retaining some growth potential. Tax-efficient investing. Paying less tax on your investment earnings is another important strategy in today’s more challenging climate. Ensure that your overall portfolio is managed from a tax perspective, including making full use of the Tax-Free Savings Account (TFSA). Addressing a portfolio imbalance. Sudden market movements can quickly cause an imbalance in your portfolio, increasing your risk. In today’s markets, rebalancing your portfolio can present opportunities to increase your potential long-term gains by acquiring core equity holdings at low prices.
J. Michael Keegan and Angela Wadsworth
Bridging the gap. A decline in your portfolio may have set back your progress toward achieving major financial goals. While in some cases it may be necessary to revise your time horizon, it may be possible to bridge the gap in other ways. For instance, it could be worth considering boosting your savings by making short-term lifestyle changes. If you are near retirement age, you may consider an alternative strategy, such as negotiating a phased-in retirement with your employer or taking on a consulting role.
DID YOU KNOW? Leaving a gift to charity in your will may reduce the estate tax burden on your heirs significantly.
Revisiting estate issues. The sweeping revaluation of assets in recent months may have changed the value of property you have bequeathed to your heirs and favorite charities. Review your estate plan to determine if your goals are still being met. Careful tax planning and incorporation of insurance solutions may be utilized to help achieve your personal legacy for loved ones and worthy causes. It’s important not to overreact to shortterm changes in the markets and economy. Be proactive. Taking a fresh look at your financial plan when significant changes occur will enable you to take any steps needed to get your plan back on track. More importantly, the process will help give you peace of mind in these tumultuous times.
Inspire the future 100% of children benefit from exposure to arts education, increasing their self-confidence and lifelong success. Every year, thousands of children participate in the magic of Arts Umbrella, including free-of-charge outreach programs delivered to communities across the province.
Make it your legacy. Contact us to find out how. 604-681-5268 x237
Founding Sponsors:
www.artsumbrella.com
LL0 | November 2009
Can my family challenge my will? By Alanna Donahue, Director of Philanthropy BC Children’s Hospital Foundation
Your will is an essential part of your estate plan. Thinking about how you would like to distribute the assets and discussing your wishes with your family is important. Alanna Donahue Sometimes families have complex dynamics and “blended” families can present challenging estate planning issues. In such situations it is all the more important to obtain advice before finalizing your plan and signing your will. Wills can be challenged on a number of grounds. British Columbia’s Wills Variation Act provides that if you die leaving a Will that does not, in the court’s opinion, adequately provide for the “proper maintenance and support” of your spouse (which includes common law spouses and spouses of the same gender) and/or children (which includes adopted children but not stepchildren) the court may
vary your Will to provide for them as the court thinks appropriate. As the Act does not require a spouse or child to be financially dependent upon the deceased to bring such a claim, it is common for such claims to be initiated by an adult self-supporting child of the deceased, not infrequently a child who has been estranged from his or her deceased parent.
A great deal of litigation is commenced each year in the context of second marriages and blended families but also in cases where a parent has decided to treat his or her children unequally. Even if a parent is of the opinion that the reason for disinheriting a child, or providing a child with less than his or her siblings, is a sound one, if an estate plan does not deal with a potential claim under the Act, the executor and the other children may find themselves embroiled in unpleasant litigation after the parent’s death.
To minimize the possibility of a successful challenge to your will and to ensure that your wishes will be upheld, including your legacies to the charities that you support, it is important to seek professional advice and to develop a sound estate planning strategy. continued on page 7
November 2009 | LL0
Can my family challenge my will? continued from page 6 “A great deal of litigation is commenced each year in the context of second marriages and blended families but also in cases where a parent has decided to treat his or her children unequally.”
A will can also be challenged on the basis that the deceased did not have the mental capacity required by the law to sign the will or was unduly influenced or perhaps did not sign it in accordance with the technical requirements imposed by law. As such, BC Children’s Hospital Foundation recommends that you seek professional advice before you draft or change your will.
A number of planning techniques are available. The first technique is “joint tenancy” by which assets might be placed in a form of joint ownership with the intended beneficiary or beneficiary in such a way that the will is bypassed. Placing bank accounts or investment accounts in joint ownership may be of assistance, as may be designating the intended beneficiary as the beneficiary of a life insurance policy, pension plan or RRSP. If you are over 65, an “alter ego” trust to which you may transfer your assets can often give the best result as it provides protection from the Wills Variation Act and can result in the avoidance of probate taxes.
High Ropes at the Zajac Ranch for Children. photo courtesy of The Mel Jr. & Marty Zajac Foundation
DID YOU KNOW? Over the next 20 years up to 1.5 trillion is expected to change hands — the largest wealth transfer ever in Canada. Recipients of those assets will be heirs, non-profit and charitable organizations and government (through taxes).
LL0 | November 2009
A brave war veteran; a grateful daughter tions like the Red Cross. I’m certain that if it weren’t for the Red Cross, my father wouldn’t have survived WWII. Henri Dorval was one of the 72 soldiers reported missing in action after the Dieppe invasion of France in September 1942. Wounded by shrapnel he was taken as a prisoner of war. His parents, and my mother, who was then his fiancée, didn’t hear from him for almost a year after his capture. They didn’t know if he was alive. My father later told me he and the other POW’s had no contact with the outside world at first. But then the Red Cross packages started to arrive. These packages were lifelines to POW’s, letting them know that people were thinking about them, that someone cared enough to send them something from home, even though they didn’t have much to spare during the hard years of the war.
By Marguerite Dorval, Member of Red Cross Legacy Club
He said, “If it wasn’t for the Red Cross I don’t think I would have made it.” After three years in captivity, he was finally released in the spring of 1945 and married my mother in England that July.
There are thousand of stories like ours — people who owe their lives and their futures to amazing organiza-
When my mother was pregnant with me, my father came back to Canada to find a job and prepare our
War bride’s Family Reunited
home. In late 1946, my mother and I arrived on a ‘War Bride Ship’ at the famous Pier 21 in Halifax. From there, the special Red Cross war bride escort officers helped us reunite in Ontario. It was the first time my father held me in his arms. These very personal memories of the difference the Red Cross made in my parents’ lives, at times when they needed help the most, prompted me to take my support beyond regular donations. That’s why several years ago I decided to join the Red Cross Legacy Club. We’re a group of committed donors who want to help the Red Cross be there for future generations. I know my mother and father, both of who are gone now, would be proud of my decision. I still get quite emotional when I think about the difference the Red Cross made in the life of my family, first helping my father survive the horrors of the POW camp, and then helping us all reunite on Canadian soil. I know that was possible only because of the generosity of donors and volunteers. That’s why I am proud to be doing my part to help people in the future, when they need it most.
November 2009 | LL0
A helpful tip to eliminate taxes during will preparation By Toni Andreola, Director, Planned Giving Canadian Cancer Society, B.C. and Yukon
Alice Trickett and her husband moved to a farm in Aldergrove, BC soon after they were married. They enjoyed their home immensely and raised three lovely children there. Although mothalice trickett erhood occupied much of each day, Alice carved out special time to support community causes both financially and as a volunteer. Alice’s life changed forever when she developed breast cancer at age 57. After her cancer diagnosis in 1986, she re-focused her energy on the cancer cause. She became a door-to-door canvasser, collecting donations to the Canadian Cancer Society for over 20 years. Cancer invaded her life again, reoccurring just two years later. Alice underwent another round of treatment and survived. Cancer stole all three of her brothers. Alice’s granddaughter Crystal was diagnosed with lymphoma and survived a bone marrow transplant. Sadly, Alice passed away in 2008. Prior to passing, Alice had met with a lawyer to update her will. In preparing
her will, her first priority was to remember her family. But she was also concerned about the high estate taxes she would pay on her passing. These would be taxes the government might take from her estate. She wanted some assurance to prevent this from happening. So, on her own, she created an innovative clause and attached it to her will as a codicil. The clause instructed her executor to calculate the taxes owing at her death and in the previous year, and to make charitable donations just large enough to eliminate those taxes owing through her estate. The wording in this clause would ensure the majority of her estate would pass to her own family, and the government’s share would be replaced with the charities she cared about. The Canadian Cancer Society recognized that Alice’s strategy — replacing taxes with a gift to charity, without unduly impacting family and other loved ones — might appeal to many others, so the Society asked an estate lawyer to review and re-word Alice’s codicil with a view to sharing it with the general public. The “Estate Tax Eliminator Clause” can be used by people who wish to consider this type of strategy when preparing their wills. While many people can use this clause effectively to reduce their estate taxes, the Canadian Cancer Society cautions that people preparing their will should first review this strategy with both legal and tax professionals to determine its suitability for each individual’s unique personal situation.
Donor-advised funds facilitate donor selections for charitable giving By Jacqueline Dagg, Manager, Donor Relations Vancity Community Foundation
Friends of Brooke have a yearly garage sale in Vancouver and this 2009 sale generated $2300 in donations to the Brooke Forbes Legacy Fund. Photo courtesy of Joan Andersen
Brooke Forbes enriched the lives of many as a producer at CBC Radio for over 20 years. She was among the first on-air hosts for Vancouver Cooperative Radio. For many years she ran a Radio Camp for minority youth at CBC Radio and encouraged young people to consider radio as a career option. After her death in 2006, Brooke’s family and friends wanted to honor the charitable work she was most passionate about — projects involving minority youth and radio. Her estate did not provide for an endowment or private foundation to carry on that charitable work. One of Brooke’s friends heard that the Vancity Community Foundation could
establish an endowment fund that would direct funding to charities. Her friends and family decided to create a donor-advised fund at the Vancity Community Foundation and named it the Brooke Forbes Legacy Fund to remember her contribution to the community and the world of radio and to maintain ongoing giving to this cause. A donor-advised fund is an endowed fund created by a donor(s) that is named and held by a public charity, typically a community foundation. A donor-advised fund is a cost-effective alternative to the creation of, and running of, a private foundation since these donor-advised funds are managed by the public charity. A donor-advised fund enables the donor(s) to recommend the charities to which they would like to grant their regular donations. Donations to the donor-advised fund can be made by anyone and each donor will receive a charitable donation receipt that can be claimed for tax purposes. The Brooke Forbes Legacy Fund was created as a legacy after her death to continue the charitable giving established by Brooke during her lifetime. A donor-advised endowment fund can also be created during one’s lifetime with Vancity Community Foundation and serves as a tax planning vehicle to facilitate one’s charitable giving options during one’s lifetime and beyond.
LL10 | November 2009
A life of passion, a legacy of hope By CHARLENE TAYLOR, Associate Director, Planned Giving VGH & UBC Hospital Foundation
Then, in 2007, Pat received word that the tumors had returned for the eleventh time and were in a location that any attempt to operate would leave her blind in one eye and likely confined to a wheelchair. With that knowledge and knowing that the tumors would probably return, Pat decided not to have the operation. Quality of life was more important.
Pat McQueen faced tremendous challenges during her lifetime, but she never gave up on her passions. A voracious reader and an avid history buff, she received her Master’s Degree in History from SFU in 1999. It was during her studies that Pat began to suffer from fatigue and headaches. Her condition worsened, with occasional bouts of vertigo and nausea, when in 1993, she was diagnosed with a brain tumor and underwent surgery to remove a grapefruit-sized growth.
“When we got back from Russia in 2008, we actually didn’t know where we wanted to go next because we’d finished the ‘bucket list’,” laughs Jim. “Unfortunately, Pat passed away in August 2008.”
In gratitude for her care, she made VGH & UBC Hospital Foundation the beneficiary of her life insurance policy, to leave a legacy gift to benefit neuroscience research at VGH. Pat always said that if she had been diagnosed with the same condition 10 years earlier, she wouldn’t have lived as long as she did. She recognized the need to make advances in research and the ongoing understanding of the human brain. She wanted to give something back and research is her lasting legacy.
“Travel was a passion for us and Pat was a wonderful travel partner,” explains Jim McQueen as he pauses to wipe away tears, and recounts his 36 year marriage to his wife. “The prognosis was initially very good. We were told that less than 2 per cent of patients ever experience a reoccurrence.” However, the tumor returned in 1995, beginning a cycle of treatment and recurrence that would lead to more than 25 surgeries. Despite her struggles with the illness, Pat persevered. She had finished her degree and continued to pursue her interests, but her greatest love was seeing the world. “I’d never traveled outside of Canada,” Jim recalls. “In 1974, two years after we were married, we decided to go to England for a vacation and that’s when the travel bug really caught us.”
Pat and Jim McQueen in Egypt
In 2004, Pat suffered a seizure, prompting Jim to retire. At that point, they set some priorities and decided that they would spend as much time as possible traveling, from the ancient city of Machu Picchu in Peru, to the pyramids of Egypt, and beyond.
DID YOU KNOW?
Five times more people would consider leaving a gift to charity through their estates if their lawyer, financial advisor, trust officer or insurance consultant discussed this option with their clients.
November 2009 | LL11
Creating a legacy with registered retirement funds (RRSP/RRIF) By Isabela Zabava, LL.B., Senior Director, Planned Giving, BC Cancer Foundation
“I am keeping my wife’s memory alive,” says Peter Roth when asked why he donated to the BC Cancer Foundation. Peter’s wife Renate, passed away from ovarian cancer in 1999. After talking with a gift planning Peter Roth holding a officer at the BC photo of his beloved Cancer Foundalate wife Renate tion, Peter decided to make a gift of his Registered Retirement Income Fund (RRIF). “It was my wife’s RRSP that became mine when she died. By designating the BC Cancer Foundation as the beneficiary, the gift does not come out of my pocket now, but when I pass away the remaining value can support the BC Cancer Foundation. The tax benefits decrease the amount of taxes my estate will incur. It’s an easy way to give and to support a good cause,” says Peter. Three things to know about designating your RRSPs or RRIFs to a charity: 1. Tax implications: Except for certain circumstances, when a person passes away, their RRSP or RRIF
assets become fully taxable. The assets are transferred in cash to the beneficiary but the tax on the assets is paid by the deceased’s estate. This tax can be reduced or eliminated if the deceased has designated a registered charity as a beneficiary of the RRSP or RRIF. 2. Beneficiary designations: In most cases, designating a registered charity as a beneficiary of all or a portion of your RRSP or RRIF is as easy as completing a beneficiary designation form at the financial institution that holds the funds. In some cases, however, the financial institution may advise that their form does not permit a beneficiary other than your estate. If that is the case with your financial institution, and you wish to maintain your RRSP or RRIF at that institution, simply instruct your lawyer to designate the charity of your choice as the beneficiary of your RRSP or RRIF through your will or a codicil. 3. Name of the beneficiary charity: Many charities may be supporting different aspects of the same cause and may have similar names. Some charities may be known or advertised by names other than their legal name. To avoid confusion and extra expense to your estate, contact the charity you would like to benefit to obtain their legal name. Be sure to ask if they are a registered charity, so that your estate will be able to obtain a charitable tax receipt for your gift. Let the charity know how you would like your gift to be used, to ensure that they are able to meet your wishes.
LL12 | November 2009
A gift of hope for people with dementia By Marianne J. Dupré, Communications Officer Tapestry Foundation for Health Care
Lynn Jackson holds a Guardian Angel, a special recognition gift honouring her contributions to Tapestry Foundation for Health Care.
Lynn Jackson was just 43 years old and in the prime of professional life when she was diagnosed with dementia — a prog re s s i v e , degenerative disease that destroys vital brain cells.
Ten years later, thanks to the intervention of medical professionals, an individualized regime of medications and the loving support of a tremendous network of family and friends, Lynn is savouring every moment of her life. Through a legacy gift to Tapestry Foundation for Health Care in support of dementia research, she’s hoping others living with the disease will be able to taste the joys of life even longer. “My journey with dementia has been difficult for sure, but enlightening,” she said. “It’s taught me many things — the power
of knowledge, how not to isolate myself, how to support others with the disease, and how to make plans for my future on my terms. These things have kept me motivated to live each day as fully as I can, while I still can.”
Lynn has made it her mission to learn everything she can about her disease, and what will happen to her as it progresses. In looking forward, she’s named family and a good friend to speak on her behalf when she no longer can, and has carefully documented her personal wishes on how she wants to be cared for in the future.
Lynn, and others living with demands and daily challenges of dementia, are taking control now of the important medical, legal and financial decisions that will affect their lives as their disease progresses. For Lynn that included a decision on making a legacy gift to Tapestry Foundation.
Lynn encourages others living with dementia to consider legacy gifts to support dementia research through Tapestry Foundation. “I had a clear objective in mind which I set out in a Will drafted by my lawyer. I have since made subsequent changes through my Notary Public,” she explained. “At the end of the day, my decision to leave a gift in my Will is something I feel good about.”
e
November 2009 | LL13
LEAVE A LEGACY™ Greater Vancouver 2009/10 Partners
Abbotsford Community Services Janna Dieleman, Donor and Community Relations janna@paralynx.com (604) 859-7681
Boys and Girls Clubs of Greater Vancouver Lisa Hoglund, Manager of Fund Development lhoglund@bgc-gv.bc.ca (604) 879-6554
ALS Society of BC & Yukon Wendy Toyer, Executive Director wendy@alsbc.ca (604) 685-0737
British Columbia Guide Dog Services William Thornton, CEO guidedog@telus.net (604) 940-4504
Association of Neighbourhood Houses of BC Mamie Hutt-Temoana, Chief Executive Officer central@anhgv.org (604) 875-9111
British Columbia Hospice Palliative Care Association Harjit Grewal, Administrative Manager office@hospicebc.org (604) 806-8821
Autism Support Dogs William Thornton, President guidedog@telus.net (604) 940-4504
BC Wildlife Federation Patti MacAhonic, Executive Director patti@bcwf.bc.ca (604) 291-9990 BCIT Foundation Linda Ashton, Manager, Development and Legacy Giving linda_ashton@bcit.ca (604) 432-8302 Big Brothers of Greater Vancouver Meaghen Taylor-Reid Special Projects Officer mtaylor-reid@bbgvf.com (604) 876-2447 (ext. 233)
Canadian Diabetes Association Jana Lyons, Senior Development Officer jana.lyons@diabetes.ca (604) 732-1331
Canuck Place Children’s Hospice Michelle Cadario, Manager, Leadership Gifts and Planned Giving mcadario@canuckplace.org (604) 646-1340
BC Centre for Ability Monica Chui, Director of Resource Development mchui@centreforability.bc.ca (604) 630-3028
BC Lions Society for Children with Disabilties Jennifer Ingham, Vice President, Development jingham@lionsbc.ca (604) 873-1865
Canadian Cancer Society, BC & Yukon Division Toni Andreola, Director, Personal Giving tandreola@bc.cancer.ca (604) 675-7112
Canadian Red Cross David Magnuson-Ford, Manager, Gift Planning david.magnuson-ford@redcross.ca (604) 709-6654
BC Cancer Foundation Isabela Zabava, Senior Director, Planned Giving izabava@bccancer.bc.ca (604) 877-6157
BC Children’s Hospital Foundation Diane Haarstad, Planned Giving dhaarstad@bcchf.ca (604) 875-3679
Canadian Breast Cancer Foundation, BC/Yukon Region Christine Basque, Director, Major Gifts & Planned Giving cbasque@cbcf.org (604) 683-2873
Child Development Foundation of BC Judy Krawchuk, Chief Operating Officer judy@cdfbc.ca (604) 591-5903
photo courtesy of Langley Child Development Centre
British Columbia Lung Association Scott McDonald, Executive Director mcdonald@bc.lung.ca (604) 731-5864 British Columbia Professional Firefighters’ Burn Fund David Dales, Executive Director david@burnfund.org (604) 436-5617
Clark Wilson LLP Richard Weiland, Partner rtw@cwilson.com (604) 891-7709 Coastal Sound Music Academy Society Dan Mattinson, Executive Director info@coastalsoundmusic.com (604) 469-5973 Covenant House Vancouver Christine Dowling, Gift Planning Specialist dowling@covenanthousebc.org (604) 639-8934
Bull, Housser & Tupper LLP Margaret Mason, Lawyer mhm@bht.com (604) 641-4905
Crossroads Hospice Society Anita Cymet, Development and Fundraising Officer anita.cymet@crossroadshospice.bc.ca (604) 945-0606
Burnaby Hospital Foundation Cheryl Bosley, President info@bhfoundation.ca (604) 431-2881
Davis LLP Mary B. Hamilton, Lawyer mbhamilton@davis.ca (604) 643-6490
LL14 | November 2009
LEAVE A LEGACY™ Greater Vancouver 2009/10 Partners Dr. Peter AIDS Foundation Leah Soloman, Development Manager lsoloman@drpeter.org (604) 331-3452
Lions Gate Hospital Foundation Joanne McLellan, Director, Gift Planning joanne.mclellan@vch.ca (604) 904-3553
FH Canada Cecilia Bush, Foundations & Planned Giving Manager cecilia.bush@fhcanada.org (604) 853-4262, (ext. 201)
Lower Mainland Down Syndrome Society (LMDSS) Theresa Preston, General Manager lmdss@telus.net (604) 591-2722
Fraser Valley Health Care Foundation Vicki Raw, Executive Director vicki.raw@fraserhealth.ca (604) 851-4890
Maple Ridge/Pitt Meadows Community Services Joanne Leginus, Director of Administration & Services jleginus@comservice.bc.ca (604) 467-6911 (ext. 206)
Fraser Valley Heritage Railway Society Allen Aubert, Secretary allenaubert@shaw.ca (604) 538-9611
SEVA Canada Society Heather Wardle, Director of Development fundraising@seva.ca (604) 713-6622
Heart & Stroke Foundation of BC & Yukon Linda Netherton, Director, Personal Gifts lnetherton@hsf.bc.ca (604) 737-3421
Langley Child Development Centre Lynne Pearson, Executive Director lpearson@langleycdc.com (604) 534-1155 (ext. 101) L’Arche Greater Vancouver Sig Stark, Director of Fund Development sstark@larchevancouver.org (604) 435 9544 (ext. 35) Last Door Recovery Society Giuseppe Ganci, Public Relations pr@lastdoor.org (604) 525-9771 Legion Foundation Maria Thomsen, Executive Director admin@bcyuk.legion.ca (604) 736-8166
Peace Arch Hospital and Community Health Foundation Stephanie Beck, Development Officer, Planned Giving stephanie.beck@peacearchhospital.com (604) 535-4520
Ronald McDonald House BC Richard Pass, CEO rpass@rmhbc.ca (604) 736-2957
H.R. MacMillan Space Centre Tracy Cromwell, Director of Development and Marketing tcromwell@spacecentre.ca (604) 738-7827 (ext. 249)
Knowledge Network Corporation Donna Robinson, Development Officer donnar@knowledge.ca (604) 431-3136
Pacific Parkinsons Research Institute Dale Parker, Chair ppri@telus.net (604) 681-5031
Ridge Meadows Hospital Foundation Sandra Rankin CFRE, Executive Director Sandra.Rankin@fraserhealth.ca (604) 463-1822
Greater Vancouver Food Bank Society Heidi Magnuson-Ford, Director of Development heidimf@foodbank.bc.ca (604) 876-3601
Kelowna General Hospital Foundation Diane Paterson, Gift Planning Officer diane.paterson@interiorhealth.ca (250) 862-4300 (ext. 7011)
Pacific Assistance Dogs Society Shelley Grogan, Manager of Fundraising & Volunteer Programs shelley@pads.ca (604) 527-0556 (ext. 222)
photo courtesy of the salvation army
Miller Thomson LLP Sandra L. Enticknap, Partner senticknap@millerthomson.com (604) 643-1292 Mind Foundation of BCSS Sue Saunders, Chair: Planned Giving ssaunders@bcss.org (250) 247-8139 North Shore Community Foundation David Alsop, President alsop389@telus.net (604) 980-7272 North Shore Community Resources Society Li Boesen, Executive Director li.boesen@nscr.bc.ca (604) 985-7138 North Shore ConneXions Society Wendy Padwick, Director of Children & Family Services wendyp@nsconnexions.org (604) 984-9321
SHARE Family and Community Services Society Heather Scott, Director of Development heather.scott@sharesociety.ca (604) 529-5119 Solus Trust Company Limited John Blackmer, President & CEO jblackmer@solustrust.com (604) 683-5949 SOS Children’s Village BC Cary Gaymond, Director of Philanthropy carygaymond@sosbc.org (604) 582-2990 (ext. 224) Stroke Recovery Association of British Columbia Ron Sayer, Director of Finance finance@strokerecoverybc.ca (604) 688-3603 (ext. 102) Surrey Foundation/Surrey Cares Kim Angel, Executive Director info@surreyfoundation.org (604) 591-2699 Surrey Memorial Hospital Foundation Yolanda Benoit, Manager, Individual & Planned Giving yolanda.benoit@fraserhealth.ca (604) 585-5666 (ext 2169)
November 2009 | LL15
LEAVE A LEGACY™ Greater Vancouver 2009/10 Partners Tapestry Foundation for Health Care Ann Corrigan, CEO acorrigan@providencehealth.bc.ca (604) 877-8335
Trinity Western University Inga Warnock, Executive Director of Planned Giving warnock@twu.ca (604) 513-2033
VGH & UBC Hospital Foundation Charlene Taylor, Associate Director, Planned Giving Charlene.Taylor@vch.ca (604) 875-4917
WRA Wildlife Rescue Association of BC Dr. Glenn Boyle, Executive Director glenn@wildliferescue.ca (604) 526-2747
TD Waterhouse, Private Trust Robin L. Smith, Executive Trust Officer robin.smith@td.com (604) 659-7438
Union Gospel Mission Foundation Carey Bornn, Principal and Planned Gifts cbornn@ugm.ca (604) 215-5441 (ext. 328)
West End Seniors’ Network Society Lynn Gardiner, Executive Director executivedirector@wesn.ca (604) 669-5051
YMCA of Greater Vancouver Charlene Giovannetti-King, VP, Funds Development Charlene.giovannetti-king@vanymca.org (604) 622-4954
The Adoptive Families Association of BC Rena Konomis, Financial Development Coordinator fundraising@bcadoption.com (604) 566-8104 The Arthritis Society, BC & Yukon Division Susan McAlvey, Director, Annual Giving smcalvey@bc.arthritis.ca (604) 714-5559 The Elizabeth Fry Society of Greater Vancouver Shawn Bayes, Executive Director shawn.bayes@elizabethfry.com (604) 520-1166 The Mel Jr. & Marty Zajac Foundation Carmen Zajac, President info@zajac.com (604) 739-0444 The Salvation Army, BC Division Kathy Mannas, Planned Giving Officer kathy_mannas@can.salvationarmy.org (604) 299-3908 The University of British Columbia Elizabeth Ko, Director of Development, Gift & Estate Planning elizabeth.ko@ubc.ca (604) 822-8906
Vancity Community Foundation Calvin Fong, Manager, Development and Philanthropic Services calvin_fong@vancity.com (604) 877-7241
West Vancouver Community Foundation Delaina Bell, Executive Director delaina@westvanfoundation.com (604) 925-8153
Vancouver Board of Parks and Recreation Josie Riebe, Manager of Fundraising & Development josie.riebe@vancouver.ca (604) 718-5888 Vancouver Foundation Craig Hikida, Director, Development and Donor Services craigh@vancouverfoundation.ca (604) 629-5360 Vancouver Orphan Kitten Rescue Association (VOKRA ) Karen Duncan, President rescue@vokra.ca (604) 731-2913 VanDusen Botanical Garden Association Dawn M. Russell, Development Director drussell@vandusen.org (604) 257-8190 Variety – The Children’s Charity of BC Peter Chipman, Director of Planned Giving/Major Gifts peter.chipman@variety.bc.ca (604) 320-0505
For further information, please contact any of the advertisers or LEAVE A LEGACY™ partners listed in this publication. Additional information can also be obtained by contacting the Canadian Association of Gift Planners’ LEAVE A LEGACY™ Coordinator at 1-888-430-9494 ext. 3 or leavealegacy@cagp-acpdp.org Please visit our website at www.leavealegacy.ca/vancouver LEAVE A LEGACY™ Greater Vancouver would like to express appreciation to the participating partners and advertisers, LEAVE A LEGACY™ Coordinator Colleen Killorn of Bestway Marketing Solutions and Ellyn Schriber and the team at Canwest Community Publications for their support in the production of this 10th Annual LEAVE A LEGACY™ publication. This supplement is a forum for information about charitable gift planning. Neither CAGP-ACPDP™ national office nor any of its roundtables or the leave a legacy™ program will be held liable for any claims made by advertisers.
LL16 | November 2009
November 2009 | LL17
Innovation from an innovator benefits St. Paul’s Hospital By Yolanda Bouwman Manager, Planned Giving, St. Paul’s Hospital Foundation
Norman and Ella Galloway
Norma Houle has many happy memories of her father, Norman Galloway, who passed away in 2007 at the age of 93. An innovative, creative, determined and hardworking man, her father left school at 15 to work as a boat builder at the Vancouver Shipyards. His natural talent in math and design came in handy both at work and at home where he created his own inventions. Norma recalls that she and her two sisters grew up believing that their father could do anything. He could also surprise them. After his death, the family found out Galloway had left a bequest in his will to St. Paul’s Hospital Foundation. But no one knew exactly why he chose St. Paul’s Hospital since he had never been a patient there to anyone’s knowledge. However,
they did know that St. Paul’s was on Galloway’s regular route to work at the shipyard. During the Depression, he would likely have seen up to 700 people a day lined up at the side entrance of the hospital, as it was widely known the Sisters of Providence—the nuns who established St. Paul’s Hospital more than a century ago—fed those in need, and no hungry person was refused a meal. He told his daughters how impressed he was that the Sisters could be counted on to help and how much he respected them even though he was not a religious person. Norma feels her father’s memories and deep respect for hard work was his motivation to include a gift to St. Paul’s in his will. As for many of his generation, Galloway’s family home had appreciated in value considerably over the years. Having lived frugally all his life, he was surprised to discover that the value of his house and surrounding property had almost made him a millionaire. His annual income was quite ordinary, but he realized that by donating a portion of his estate, he could accomplish quite extraordinary things for a community he wished to give back to. He learned that just about anyone can create a lasting legacy. Norma Houle agreed that her father’s gift should be used to help purchase an innovative CT scanner at the hospital. Innovation from an innovator. “Dad would have liked that.”
LL18 | November 2009
A legacy of excellent health care on the North Shore By Joanne McLellan, Director, Gift Planning Lions Gate Hospital Foundation
Before getting married in 1995, Christopher Humphreys and Dorothy BoothHumphreys were each married for over 50 years before they were widowed. In fact, the two couples had been close friends since their days in the Royal Canadian Air Force before the start of WW II.
dent and careful with their money, and worked to ensure their independence in their retirement. They chose to make regular donations to LGH Foundation, and left considerable estate gifts to the Hospital. Foundation staff worked with their family to determine where they would want the money to go. At the family’s request, funds were put toward growing the Foundation’s endowment, bringing a new angiography suite to the Hospital, and building a fund for future capital projects.
“It was important to my mother and Christopher that health care on the North Shore be available and accessible,” said Dorothy’s son, Michael Booth. “They liked contributing to local foundations – things that would support their community.”
Christopher Humphreys & Dorothy Booth-Humphreys
Both Christopher and Dorothy shared a love for the outdoors and a passion for healthy living, which included hiking and mountain climbing. Sadly, they were married only five years before Dorothy passed away at Lions Gate Hospital (LGH) after a period of declining health at home. Eight years later, Christopher passed away in his West Vancouver home. He was 94. While neither was wealthy, they were pru-
Estate gifts make an enormous difference to the Foundation, which helps support health care on the North Shore through investing in new medical equipment and facilities. During the 2007/08 fiscal year, 23 per cent of the Foundation’s revenue, approximately $2.7 million, came from estate gifts.
The Foundation’s policy is that for gifts of $50,000 or more, 50 per cent is placed in an endowment, unless otherwise specified by the donor. This endowment sustains LGH Foundation and health care well into the future. The balance of the gift goes to the current campaign or other areas of interest for the family.
November 2009 | LL19
The six most common mistakes in estate planning
Photo courtesy of Peace Arch Hospital and Community Health Foundation
By Leslie Howard, Founder, Planforgifts.com, on behalf of Peace Arch Hospital and Community Health Foundation
At worst, a poorly planned estate can result in lengthy administrative delays and pain and hardship for loved ones, and at best, simply result in less money for beneficiaries. Here are six of the most common estate planning mistakes: Mistake #1 No Will “I’m too young, too busy or just can’t face it.” There are many excuses for not having a will but without one, you lose control of your assets and what happens to them when you are gone. The government will appoint an executor and distribute the assets through a formula. For those with underage children who have not appointed a guardian in their Will, the government will appoint one. Administrative costs and fees will be much higher. Mistake #2 Not taking Steps to Minimize Fees and Taxes With the help of your legal and financial advisors, look for appropriate situations for estate tax planning. Remember that your RRSP/RRIF becomes fully taxable upon your death, but the tax credit from a charitable gift can offset the tax. Mistake # 3 Not Considering a Charitable Gift For many people who lacked the income to make gifts during their lifetime, an estate gift is their opportunity to give back to the community and to reap the estate
tax benefits that result from such a gift. Discussing your intentions with your family is your first step towards including a charitable gift in your will. Mistake # 4 Not Considering Family Dynamics Families today come in all shapes and sizes. Consider the make-up of your immediate and extended family and the special financial and emotional needs of everyone. Are there special circumstances such a physical or mental disability, substance abuse issues, or family members who are spendthrifts? Your legal counsel can help you draft an estate plan that addresses these issues. Mistake # 5 Not Appointing the Right Executor Gone are the days when being appointed an executor is considered an honour. Today’s estates are complex affairs requiring financial and legal savvy. An executor faces many hours of hard work to settle the administration of the estate and pay out funds to beneficiaries. In addition, executors are personally liable should the estate not be managed properly. When drafting your will, choose your executor based on their experience and their willingness to take on the role and remember to appoint someone younger than yourself! Mistake # 6 Not Updating Regularly Your estate plan needs to reflect your ever changing life and the people in it. Wills should be updated at least every three years to reflect “hatches, matches and dispatches” or in other words; births, marriages or deaths of family members.
LL20 | November 2009
Charitable gift planning options Canadian Association of Gift Planners (CAGP) www.cagp-acpdp.org
event that others named in your will predecease you.
BEQUEST The most common type of legacy gift is a charitable bequest or gift by will. If you don’t have a will there is no mechanism in place to make a bequest and your assets may not be distributed the way you would have liked. A bequest to a charity is very easy to put in place and can be modified at any time. In addition, the tax receipt the charity issues may result in a significant tax credit on your final income tax return. (Your estate may claim donations of up to 100% of your net income for the year of death and the year preceding death.)
SECURITIES A gift of publicly-listed securities provides an innovative and creative way to make a charitable gift and can include stocks, bonds and mutual funds. Federal incentives introduced in early 2006 have made it very attractive to donate publicly listed securities that have appreciated in value. Canadians are not taxed on the capital gain when they donate securities to a charity. This compares to a tax on 50% percent of the capital gain if the securities are sold and then donated.
TYPES OF BEQUESTS A specific bequest the donor indicates that the charity is to receive a specific dollar amount, or a specific asset, such as real estate. A residual bequest gives the charity all or a portion of the donor’s estate after all the debts, taxes, expenses and other bequests have been paid. A contingent bequest takes effect only upon the occurrence of some other event. For example, you may choose to make a charity the contingent beneficiary in the
LIFE INSURANCE A gift of life insurance is made when you name a charitable organization as the beneficiary of the policy. This means that the charity would receive the insurance proceeds when you pass on. There are several ways to make a gift to charity through life insurance: •M ake the charity the owner of an existing, or new, policy If you already own a life insurance policy, or if you purchase a new policy, you may make a charity the owner and name it as the beneficiary. You will receive a charita-
continued on next page
November 2009 | LL21
Charitable gift planning options continued from page 20 ble tax receipt for the policy’s cash surrender value and for any premiums you pay once ownership is transferred to the charity. Premiums can be paid either to the insurance company or directly to the charity. •N ame a charity as primary beneficiary, or as co-beneficiary A charity can be named the beneficiary of an existing policy that you own. This is the preferred option for donors who wish to make a charitable gift but want to retain access to the cash value of the policy, or who want to be able to change beneficiaries if their circumstances change. Because you Committee Members, Canadian Association of Gift Planners Greater Vancouver Roundtable (left can change your mind about to right): Heather Hamilton-Wright, Crofton House; Nicole Jeschelnik, Vancouver Foundation, naming the charity as the ben- Dianna Hwang, Alexander Holburn Beaudin & Lang; Paul Spelliscy, Variety – The Children’s Charity eficiary, a tax receipt cannot be of BC; Joanne McLellan, Lions Gate Hospital Foundation, John Blackmer, Solus Trust Co. Ltd.; Kathy Mannas, The Salvation Army; Tim Staunton, Canadian Cancer Society; Sarah Leyshon-Hughes, Public issued for annual premiums. Guardian and Trustee of BC; Charlene Taylor, UBC & VGH Hospital Foundation. Missing from photo: However, your estate will re- Celia Campos, YWCA of Vancouver; Andy Wickey. ceive a charitable tax receipt when the charity receives the gift and this can result in exchange for a guaranteed lifetime income (or for a stated significant tax savings for your heirs. You can also name a interval of time). It is an agreement or contract between charity as co-beneficiary with other individuals or chari- you and your charity. Upon death, the charitable organization would receive the remainder of the original contributies. tion. Depending on the time elapsed the charity may get • Name a charity as contingent beneficiary A charity can be made a contingent or secondary benefi- more or less than the original contribution. If an annuity is ciary of a life insurance policy. Should your primary ben- started when you are between the ages of 75-90 you may eficiaries predecease you, the charity, as contingent ben- receive tax free income. If an annuity is started when you eficiary, will receive the policy proceeds. Because you can are between the ages of 65-74 you can receive partially tax change your mind about naming the charity as the benefi- free income. Where the income is totally tax free, you will ciary, a tax receipt cannot be issued for annual premiums. receive a donation receipt equaling the initial amount of You estate will receive a charitable tax receipt when the your contribution minus your expected annuity income. charity receives the gift. There are other options available to you if you wish to CHARITABLE REMAINDER TRUSTS make a legacy gift through insurance. Contact your insur- A gift of trust is made when you decide to make a charitable organization the secondary beneficiary to an irance or financial advisor for more information. revocable trust. The primary beneficiary (or the income beneficiary) includes you, and if applicable, your spouse. RRSPS or RRIFs Gifts of retirement plans are made when you name a char- Throughout your lifetime, or for a stated period of time, you will receive a predetermined amount from the trust. itable organization of your choice as the beneficiary. Retirement funds represent a major personal asset for Upon death, the charitable organization will receive the most donors. Donors enrolled in an RRSP, and those who remainder of the trust. have already converted their RRSP to a RRIF, can make a charitable gift of all or a portion of any retirement funds remaining at death and your estate will receive a charitable receipt for the amount received.
ANNUITIES A gift of annuity is made when you make a contribution of cash or other property to a charitable organization in
REAL ESTATE A gift of real estate is made when you leave property, buildings, land, a place of residence or recreational property that you own to a charitable organization. This type of gift can be given immediately or specified in your will. When given as part of your estate, you will receive a charitable tax receipt to be used in your final income tax return.
LL22 | November 2009
Without a will, who might benefit from your estate? By Sarah Leyshon-Hughes Regional Manager, Estate and Personal Trust Services Public Guardian and Trustee of British Columbia
“Why should I have a will?” Professional advisors hear this question constantly. Their clients offer many reasons why they don’t need to make a will — “It costs too much”; ”I don’t have anything to leave”; “I Sarah Leyshon-Hughes don’t have anyone to leave my estate to”; “It will go to my family anyway” — to name a only a few frequently heard comments. Making a will is the only way you can express your wishes on what you would like to happen on your death. Your will serves as a guide to your executor for your funeral wishes. Your will states who you want to benefit from your estate, be it large or small, and how they will benefit. It is important to remember the only way you can make a will is if you have what is known as “testamentary capacity.” If you do not have the legal ability to make a will, no one else can do it for you — even if you have told someone what it is that you want to have happen on your death. A power of attorney cannot create an estate plan for you. Neither can a representative
or a committee. Only you can do this, for yourself, and for your beneficiaries.
One of the things to consider in your estate planning is the “what if’s?” You may have made your bank accounts joint, knowing they will pass to the person with whom you are joint owner. What if this person is not alive at the time of your death? What if you do not have the capacity to make changes at that time? The proceeds of that joint account will fall into your estate. If you have no will, the estate will be distributed to your next of kin, under the rules of intestacy, and perhaps not the way you would have intended, had you been able to make a choice at that time.
At the office of the Public Guardian and Trustee of BC, we see many files where a will has not been made, and the proceeds of the estate pass to next of kin, many of whom the deceased never knew. The intestate rules provide that next of kin must be blood related or adopted into the family. Stepsiblings are not included in the distribution. Neither are relatives of a pre-deceased spouse.
Take Action! If you don’t have a will, consider how simple it could be for you to make one. A will ensures your estate, however large or small, goes where you intend it to go. By making a will, your friends, family or the organizations you care about will benefit from your estate. Moreover, you will ensure your personal legacy carries on the way you intended — and not by the operation of law.
November 2009 | LL23
A gift to the arts that nourishes the soul By Selina Rajani Communications Manager, Vancouver Opera
Jake Boxer’s family has a long legacy of generosity, support and commitment to charitable giving. His parents, Regina Boxer and the late Joe Boxer, were instrumental in the founding of Va n c o u v e r Opera. Continuing this legacy, Jake Boxer has made a bequest to the Vancouver Opera Foundation that will extend beyond his lifetime: a commitment to opera for youth and in education. Jake Boxer
“I had no choice!” Boxer jokes when asked about his own operatic education. “I was immersed from a very young age. As a teen, I rebelled and lost interest for a short time, but at the age of 21 I moved to Hamburg.
There would be a different opera every other day at the Hamburgischestaatsoper. I would get rush student tickets on my way home and saw maybe 15 to 20 operas that year.” From this experience, Boxer’s appreciation for the art form grew, as well as his conviction that the arts should be a strong force in education. To support this conviction, Boxer’s bequest will support opera programs for youth and education. The Jake & Jillian Boxer legacy fund has been established for this purpose. Boxer’s choice of bequest is based on a generous investment today which names the Vancouver Opera Foundation as the eventual recipient to carry his inspiration and generosity into the future. “I believe in Vancouver Opera. Often, the arts don’t receive the attention they should for a city of our stature. The arts have to compete with other elements – sports events, outdoor recreation in our beautiful natural environment – but art is our soul. Art helps us understand ourselves, where we’ve come from and where we’re headed. This legacy will help ensure that future generations receive the benefit of an education in the arts.”
LL24 | November 2009
Enhance your estate plan with an alter ego or joint spousal trust By Richard Weiland, Lawyer/Partner Clark Wilson LLP
spousal trust) can have access to the capital of the trust during their lifetime or lifetimes.
Alter ego and joint spousal trusts were introduced by amend– ments to the Income Tax Act in 1999. In the past decade, these trusts have become an important estate planning tool, combining the flexibility of a will with Richard Weiland asset protection and tax benefits that a will does not provide.
The principal benefit of these trusts is that assets held in them do not form part of your legal estate when you die. As a result, the assets are not subject to probate fees, not subject to claims by disappointed beneficiaries under the Wills Variation Act, and are protected from claims by any creditors of your estate. These trusts also provide a way to centralize management and control of estate assets, providing an effective and flexible way to plan for future disability.
The alter ego and joint spousal rules allow an individual (referred to as a “settlor”) to transfer property to either of these types of trusts without a deemed disposition of the property. Any accrued capital gains are subject to tax only on the death of the settlor (in the case of an alter ego trust) or on the death of the settlor and his or her spouse (in the case of a joint spousal trust). To qualify as an alter ego or joint spousal trust, the settlor must be at least 65 years old and a Canadian resident. The trustee of the trust must also be resident in Canada. All of the income of the trust must be payable to the settlor (and the settlor’s spouse in the case of a joint spousal trust) during their lifetime or lifetimes. And no person other than the settlor (and the spouse in the case of a joint
In addition to the benefits described above, you can use an alter ego or joint partner trust to fulfill your charitable intentions. If the trust empowers the trustees after your death to make a gift to a charity from the trust assets, the gift can reduce any capital gains tax arising on death.
Talk to your estate planning professional to learn more or to determine if either an alter ego or joint partner trust is right for your situation.
DID YOU KNOW? 77% of BC residents aged 15 plus (2.6 million people) donate to charity each year with an average donation of $467, which contributes $1.3 billion to our community.
November 2009 | LL25
The dream of stigma-free acceptance of schizophrenia becomes a little closer By Sue Saunders, Chair: Planned Giving Mind Foundation of BCSS
In 1982 Diana Hsu was introduced to the stigma and misconceptions associated with mental illness after one of her five daughters was diagnosed with schizophrenia. She felt the immediate impact of this illness not only her daughter, but also other members of her family. She was saddened to learn research for schizophrenia is drastically under funded compared other major diseases and effective treatments limited. Schizophrenia is caused by biochemical changes in the brain and occurs in about 1 percent of the population. It often strikes in adolescence and young adulthood and is frequently a devastating illness that causes emotional upheaval and great distress not only for the person who has the disorder, but for the family as well. Life for such families becomes a bumpy ride. The pulse of the family rides with the ups and downs of the person with the illness. Diana discovered that the BC Schizophrenia Society had just raised funds to establish the first ever Chair of Schizophrenia at the University of British Columbia. She became active in the cause in the hope that if more people, including the medical profession, had a better understanding of schizophrenia, it would one day be viewed like any other serious illness. It
was her belief that better understanding, increased awareness and more effective treatment could only come through scientific research. Diana became a generous supporter of the Dr. Norma Calder Schizophrenia Foundation, formed by the BC Schizophrenia Society to support research in BC. She also left the bulk of her estate the form of a bequest to this organization. When Diana died in 2007, her executors (daughters Jean and Elizabeth) learned the Calder Foundation had been re-named Mind Foundation of BC. Jean and Elizabeth were able to work closely with the Foundation Board and were reassured that the Board shared the goals of the bequest and had the capability to carry out their mother’s wishes. Jean and Elizabeth requested the funds be invested in a way that would commemorate their mother and continue her support of schizophrenia research in BC. As a result of Diana’s generosity and commitment, the Mind Foundation established the Diana Hsu Memorial Endowment through the Vancouver Foundation. Interest and dividends from the endowment fund will be passed on to the Mind Foundation to support Diana’s intended purpose, and her dream of stigma-free acceptance of schizophrenia, and perhaps a cure, a little closer.
LL26 | November 2009
How to reduce taxes on your final tax return By John Pin, Will and Estate Planner, TD Waterhouse Private Trust
Benjamin Franklin said “Certainty? In this world nothing is certain but death and taxes.” Unfortunately, the income tax rules bring these two events together, often resulting in a financial tsunami for an estate and a financial windfall for the Canada Revenue Agency. However, an estate plan that provides for a charitable gift John Pin can result in a significant reduction in the amount of tax that is owed at one’s death. The most income tax a person will pay is often not paid by themselves during their lifetime, but instead is paid by their executor on their final tax return after the person has passed on. An individual is deemed to have disposed of all their assets at fair market value at their date of death. There could be significant capital gains to report on their real estate (excluding their principal residence which is tax exempt), stocks, marketable bonds, and personal items such as paintings, jewellery and antiques. There is also the deemed income inclusion at fair market value of one’s registered plans (RRSP, RRIF) on the date-of-death return. The only exclusion to this triggering date of death tax rule is when the assets or registered plans are distributed to the deceased’s spouse/common-law partner. The tax impact in this case will be felt at the death of the surviving spouse. All these income and capital gains on one tax return can result in a potentially large tax balance due. If we take a simple example of an estate with the following income inclusions on their date of death return:
Taxable capital gain on investment portfolio........$125,000 Taxable capital gain on cottage...............................$150,000 RRIF fair market value.............................................$300,000 Regular pension and investment income prior to death...............................................$ 65,000
The tax liability on the date of death return would be in excess of $250,000.
A charitable gift at death could reduce some, or depending on the size of the gift, the entire tax bill. The Income Tax Act allows for the charitable donations to be claimed on the date of death return when you make the gift through your will. The donation can also be claimed if you designate a charity to be the beneficiary of your RRSP, RRIF or life insurance policy. The maximum eligible donation credit at death is 100% of net income (increased from 75% while living) and excess credits can be carried back one year to the deceased prior year tax return. A $10,000 gift produces a tax savings of over $4,300. A gift of $50,000 saves the estate over $21,800. In our example, a donation of approximately $580,000 would be required to reduce income tax to zero. Having a proper estate plan that incorporates charitable giving can ensure the proper matching of donations credits to offset the large tax bill that can result as a consequence of death.
DID YOU KNOW? The Canada Revenue Agency (CRA) website www.cra.gc.ca/donors provides facts about tax savings, donation receipts, the regulation of charities, and how to be an informed donor.
November 2009 | LL27
LL28 | November 2009