Maximize the Impact of Your Charitable Giving
Empower your Philanthropy through smart Financial Planning
Charitable giving is a powerful tool, enabling individuals and families to create meaningful change in their communities and beyond. With proper planning and financial strategies, your philanthropy can go further – benefiting both the causes you care about and your personal financial situation. Whether you wish to establish your own charitable foundation, donate appreciated securities, or leverage life insurance for legacy giving, there are tailored charitable giving solutions to help you achieve your philanthropic goals.
Executive Summary: Popular Donation Strategies
- Direct Donation to a registered charity of your choice and receive a tax receipt.
- In-Kind Gift of Securities: Donate Appreciated Stocks or Mutual Funds to avoid realizing a taxable capital gain and receive a tax receipt for the market value.
- Donor-Advised Fund: Create your own charitable foundation with immediate tax receipts for contributions, select the charities you want to support and have all the administration looked after for you.
- Life Insurance Gift: Assign an existing policy or buy a new policy to make a larger legacy gift. Small premium payments today can make a large charitable legacy in the future.
- Segregated Funds: Insurance-wrapped investments can help bypass probate, maintain privacy and maximize your donation.
Direct Donations
Key Features and Tax Benefits:
- Simplicity: Directly donate to your chosen charity.
- Tax Benefits: Tax receipt for eligible donations.
- Impact: Immediate support for the charity’s you choose.
In-Kind Donations of Stocks and Securities
We collaborate with trusted organizations that share our vision for a better tomorrow. These partnerships allow us to extend our reach and deepen our impact—supporting causes that matter most to our clients and our team.
How You Can Join Us
Donating publicly traded stocks, mutual funds, or bonds directly to a registered charity is a tax-efficient charitable giving strategy. Known as in-kind donations, this approach allows you to contribute appreciated securities without having to personally pay tax on the investment gains. The charity will benefit by receiving the full market value of the securities.
Key Features and Tax Benefits:
- Direct Transfer: Securities are transferred “in kind” to the charity, avoiding the need to liquidate assets and incur capital gains tax.
- Enhanced Giving Power: The full market value of the security goes to the charity, maximizing your gift.
- Simple Process: Most charities and financial institutions offer streamlined procedures for in-kind donations.
- Charitable Tax Credit: Receive a donation receipt for the fair market value of the securities at the time of transfer, which can reduce your income tax.
- Capital Gains Tax Exemption: Donors are not taxed on the investment gains for securities donated directly to a registered charity.
- Potential for Estate Planning: Securities can be donated as part of your estate plan, creating a lasting philanthropic legacy and further tax efficiencies.
Donor-Advised Fund: Create Your Own Charitable Foundation
The Mackenzie Charitable Giving Program empowers donors to establish their own charitable foundation with streamlined simplicity and professional support. This program acts as a donor-advised fund (DAF), allowing you to contribute assets, select grant distributions to registered charities, and cultivate a lasting legacy of philanthropy.
Key Features and Tax Benefits:
- Personalized Foundation: Set up your charitable giving program under your name or family name, giving you control over your philanthropic impact.
- Flexible Contributions: Donate cash, publicly traded securities, or other eligible assets.
- Professional Administration: Mackenzie Investments manages all administrative details, from compliance to recordkeeping and donation processing.
- Grant Recommendations: You recommend grants to your chosen charities, ensuring your donations align with your values and priorities.
- Immediate Tax Receipt: Receive a tax receipt for your contributions, which can be used to reduce your taxable income in the year of the donation.
- Capital Gains Tax Savings: Donations of appreciated securities may eliminate capital gains tax, maximizing your charitable impact and minimizing taxes.
- Estate Planning Advantages: Foundations can continue supporting charities beyond your lifetime, offering potential estate tax benefits and legacy planning opportunities.
Life Insurance Gifts: Donation Strategies for Lasting Impact
Gifting life insurance to a charity is an innovative way to increase your philanthropic reach, often allowing for larger legacy gifts than you might otherwise be able to make.
Key Features and Tax Benefits:
- Assign an Existing Policy: Transfer ownership of an existing life insurance policy to a charity and receive immediate tax benefits for the market value of the policy.
- Purchase a New Policy: Designate a charity as the beneficiary of a new life insurance policy, creating a future gift and potential tax savings for your estate.
- Flexible Structure: Options include donating paid-up policies, making the charity the irrevocable owner, or naming the charity as beneficiary.
- Immediate Tax Receipt: If you transfer ownership, receive a tax receipt for the fair market value of the policy and for ongoing premium payments.
- Estate Tax Advantages: Life insurance gifts bypass probate and may reduce estate taxes, ensuring a larger share of your legacy goes to charity.
Using a Segregated Fund for Charitable Giving
Key Features and Benefits:
- Capital Protection: Maturity and death benefit guarantees ensures all or a portion of the invested capital is protected.
- Beneficiary Designation: Name a charity as the beneficiary to bypass the estate and reduce probate fees.
- Tax Benefits: Offers potential tax credits for charitable donations.
- Privacy: Proceeds can be paid directly to the charity, maintaining privacy of the donor.
- Flexibility: Choose from various investment funds to align with investment goals and risk tolerance.
How Charitable Giving Integrates with Financial and Estate Planning
Effective charitable giving is best achieved in partnership with a comprehensive financial plan. By integrating philanthropic goals into your overall financial and estate planning, you can maximize tax efficiency, ensure legacy continuity, and create a lasting impact. Working with a trusted financial planner allows you to tailor giving strategies to your unique circumstances and goals.
- Strategic Philanthropy: Choose the charitable giving option that fits your personal, financial, and philanthropic vision.
- Tax Optimization: Plan your gifts to take advantage of available tax credits, capital gains exemptions, and estate planning benefits.
- Family Involvement: Engage your family in legacy planning through foundations and giving programs.
- Professional Guidance: Consult with financial advisors, estate planners, and tax professionals to build a tailored charitable giving plan.
Give with Purpose, Plan for Impact
Charitable giving is more than generosity—it’s strategic. By leveraging tailored options like the Donor-Advised Funds, in-kind donations of stocks, life insurance and segregated fund gifts, you can maximize your philanthropic impact and optimize your financial plan. Discover the satisfaction that comes from making a difference while benefiting from significant tax advantages.
For personalized advice on charitable giving strategies and to learn more about setting up your own charitable foundation, donating securities, or gifting life insurance, connect with our team today. Let us help you build your philanthropic legacy and achieve your financial planning goals.