We always recommend that you consult with your financial and legal advisors to help you decide the best option for you and your family. There are significant tax benefits to charitable bequests. The university issues a tax receipt for the amount of your gift that can be claimed against your income in the year of death. Any excess can be carried back one year. If you choose to give publicly listed securities which have appreciated in value, your estate will not be taxed on the capital gains.
As you consider a charitable bequest to the University of Calgary, we can work with you and your advisors to identify and document the right type of gift. Please contact us for more information or to arrange an appointment at your convenience.
As you consider a charitable bequest to the University of Calgary, we can work with you and your advisors to identify and document the right type of gift.
Debbie arranged a $100,000 bequest to establish a scholarship endowment. This will provide a scholarship for one student each year of about $5,000 (in perpetuity).
Debbie’s estate will get a tax receipt for $100,000 and a charitable tax credit that can be used to offset any taxes that are owing.
On the final tax return, the estate can claim a maximum charitable tax credit equal to 100 per cent of the net income for the donor’s final tax return. Any excess can be applied to the tax return for the year prior.
Debbie — who lived in Alberta — had a net income of $75,000 reported on her final tax return.
She made a bequest of $100,000, which means her estate can claim a charitable tax credit on the final tax return of $75,000 and carry the excess, $25,000, back to the prior year’s tax return.
Debbie also could have stated an amount she wanted to give and left it to her executor to choose the assets that would be used to fund the charitable bequest. That way, the executor can select the assets that have the greatest capital gain — such as publicly listed securities — and maximize tax savings.
Another reason for letting the executor select the assets for the bequest is that the assets may no longer be in the donor’s portfolio at the time of death, or may have suffered a loss in value.
Charitable bequest breakdown
Bequest amount: $100,000.00
Total net income: $75,000.00
Excess creditable amount: $25,000.00
Total credit (in year of death): $75,000.00