People often ask whether they can and how to leave part of their estate to a charity of their choice. The answer is, of course, yes and it is an important piece of the puzzle of funding for some very worthy organizations.
Giving can come in many forms but the vast majority of organizations used bequeathed funds to help stabilize funding which is often subject to the winds of change. This is a very viable option no matter how big your estate is and depending on whether you have fewer people in your own direct list (spouse, children, siblings) or where the potential list of beneficiaries are well taken care of.
What To Consider
There are some basic considerations to take into account when deciding this:
- Make sure that you have the correct legal name of the charity. This seems obvious but there are often acronyms used (the World Wildlife Fund or WWF) for example so making sure your money goes first and foremost in the right direction is step #1
- Make sure that there is or isn’t a specific branch that you want to donate to – if the charity operates by a branch system then that may influence how you give;
- Try to find more information on how the charity collects donations. You can look through their website or call them directly to get more information and pass this on to us when drafting the Will;
- What should be done if the charity no longer exists? Do you have a back-up organization or do you want to leave some discretion to your personal representative(s) to find and give to a similar charity if the listed charity doesn’t exist; and
- Try to decide whether to leave a specific amount to the charity or a percentage of your estate. Both of these have their pros and cons so it is important to discuss it with us.
Leaving A Percentage vs. A Specified Amount
With regards to the last point, there have been situations where some charities have developed a reputation for seeking accountability when they are left a percentage. This can not only be upsetting for your other beneficiaries but also cost your estate significant sums in trying to deal with this. The simple answer is to leave specific amounts to any charity but this has its own pitfalls:
- Your estate might be smaller than you expected due to a significant financial event (illness, market crashes, etc) so the set amount you leave might be a bigger percentage of your estate than you imagined; and
- Your estate might be significantly larger than you expected and now the other issues rears its head and you could have made a bigger impact without impacting your other beneficiaries.
In the end there is no easy solution but there are options that we can discuss.
For more information regarding real estate law, we are Calgary’s leading legal real estate team to help you. Contact us today, 403 245 – 3500, or email us at [email protected].
