Gone are the days when only people with millions of dollars and names like Rockefeller, Kennedy or Gates could establish family foundations from which to spread their wealth. Now mainstream Canadians with a fraction of the resources can take an active role in benefiting their communities through donor-advised funds. The purpose of these funds is to allow you a voice on how your donation will be managed and distributed, while avoiding the expense and regulation of a family foundation. The key word in a donor-advised fund, however, is advice. In order for you to enjoy all the tax benefits of a gift to a charitable organization, the gift must be “complete,” meaning you relinquish control. Thus, the donor may have the privilege of making recommendations as to how the money is invested and distributed, but the charitable organization makes the final decisions.
Advantages to Consider
Simplicity, convenience and flexibility are key benefits of a donor-advised fund. Contributors to these funds might, for example, choose from a dozen programs, ranging from Summer Camp Programs to Bursaries. This arrangement is particularly attractive for people who don’t have the time to research which programs to support and who can benefit from the administrative expertise of the fund staff.
Another advantage of a donor-advised fund is that you can separate the timing of your gift from your recommendations for its use. In other words, you could make a gift this year and receive the charitable deduction on your income taxes, but reserve an opinion on how your contribution will be used until sometime in the future.
By investing in a donor-advised fund, you can watch your contributions grow over time and make helping others a long-term commitment.
Where to begin?
Minimum gift: Some funds allow you entry for as little as $5,000, but an initial gift of $10,000 to $15,000 is more typical.
Start by contacting The Children’s Foundation by calling 613-962-9292. We will be able to provide more detailed information to met your personal circumstances.