Legacy giving is a wonderful way to support the things you care about most, now and after you're gone. For many donors, it is an important part of their estate planning that requires thoughtful planning often involving family and financial advisors. Whatever your reasons, creating a legacy gift for the Mood Disorders Association provides vital funding for our education programs and support services for future generations.
 

Legacy gifts take several forms, including wills, securities, endowments, life insurance, charitable trusts, RRSPs and RRIFs, and property. Your donation may be outright, providing funds for immediate use, or it may be planned now for receipt by the Association at a future date. In many cases, such gifts can result in significant tax advantages.

If you have already made a legacy gift or are currently planning one, please let us know at operations@mdabc.net.

Gifts of Life Insurance
Insurance gifts are cost-effective and allow donors the ability to give a larger gift than you may have thought possible. Since February 2000, a charity can be made the beneficiary of a life insurance policy. Upon death, the benefits of that policy can go directly to the charity and your estate receives the resulting charitable tax receipt. In this instance, the proceeds of the life insurance policy avoid your estate and thus avoid probate taxes.

There are two ways that you can use a life insurance policy to benefit the work of the Mood Disorders Association:

Existing Policy
You can use a policy that you presently own and change the ownership and beneficiary to MDA. For premium payments that you make, MDA will provide you with a tax receipt for the full amount. You can also retain ownership and name the Mood Disorders Association as a beneficiary. However, in this case, Revenue Canada does not allow a tax receipt to be issued.

New Policy
You can take out a new policy and make the Mood Disorders Association owner and beneficiary or just beneficiary. However, as indicated above, unless MDA is owner of the policy, Revenue Canada will not allow a tax receipt to be issued. The advantages of using a life insurance policy to make a legacy gift are:

•  You can receive considerable tax benefits;
•  You can choose from a full range of products, price ranges, and payment periods to suit your circumstances;
•  Your gift is not subject to taxes, probate costs or estate debts;
•  You can make a substantial future gift through relatively small monthly, yearly, or single deposits from current income.

Wills and Bequests
A bequest through your Will to the Mood Disorders Association can be a tangible expression of appreciation for the services MDA offers ñ a gesture that might not be financially possible during your working or retirement years.

There are different ways to make a bequest to the Mood Disorders Association:

Special bequest - a gift of a fixed amount of cash or a particular asset;
Percentage share - a gift of a percentage share of the whole estate;
Contingent bequest - a gift that will take effect only in the event of the prior death of other named beneficiaries.

If you are planning to have a Will drafted for the first time, or are considering making changes to your current Will, your financial advisor can include a bequest to MDA.

Charitable gifts made in a Will are deemed made in the year of death. Therefore, the charitable tax credit is received by the estate and can offset any tax owing from the estate. The information you provide is kept entirely confidential. You are not obligated to maintain your bequest should your circumstances or intentions change. A bequest is a revocable gift. You can modify and amend your Will at any time.

Gifts of Shares and Securities
Tax changes in the 1997 Federal Budget have made donating publicly listed securities, such as stocks, bonds and mutual funds more attractive. The budget contains three key tax incentives that enhance donating publicly listed securities to charities. The amount donors can claim for tax free status on their income tax has risen from 50% to 75%. If a person makes a donation equal to or less than 75% of their annual income, they can claim it as a tax credit. When the owners of appreciated securities donate them to a charity they receive a receipt for the full market value of their gift, but only need to report 37.5% of the gain.

An additional advantage to donating publicly traded securities is the 25% capital gains limit (excluding gifts to private foundations). The rate of tax on the gain the donor of the security realizes has been reduced from 50% to 25%. The tax that the owner of a security must pay is therefore greatly reduced by donating it because they aren't taxed on it as additional income.

Charitable Gift Annuities
A charitable gift annuity is an irrevocable contract between you and a charity, under which you contribute cash or other property in exchange for a specified, guaranteed, tax-preferred income paid at regular intervals for life.

Who would be interested in purchasing a charitable gift annuity?
It would appeal to individuals who are age 65 plus, who:

•  Would like to maximize their current after-tax income;
•  Would like to make a current gift to a charity but prefer not to surrender present income

A charity gift annuity offers maximum current after-tax income and current donation to a charity. Depending on age, all or a substantial portion of the annuity payments will be tax-free.

How does it work?
You decide to make a gift of cash or property to the Mood Disorders Association. Acting on your behalf, MDA uses a portion of the contribution (normally 70-75%) to arrange for the purchase of a commercial annuity that will pay you the agreed upon income amount at regular intervals. MDA retains the excess and uses it for its charitable purposes as agreed with you, the donor. Your payments are made either directly to you, or to MDA, which in turn pays them to you. MDA sends you a special form (if required) for tax purposes.

Example: (subject to change based on available rates)

Female, age 78, contributes $50,000 for a gift annuity.

•	Life expectancy 11.9 years
•	Annual payments @ 8.2% = $4,100
•	Total expected return = $48,790
•	Tax-free portion of payment = 100%
•	Donation receipt = $1,210

Gifts of Residual Interest A gift of residual interest is an arrangement where an item of value is deeded to the Mood Disorders Association but the donor retains the use for life or a term of years. The donor is entitled to a tax receipt for the present value of the property at the time the gift is made.

Charitable Remainder Trusts A charitable remainder trust can be made within the donor's lifetime or established within the Will. Under this type of planned gift, the donor makes a gift to the Mood Disorders Association through a trust agreement. If the property generates income, the net will be paid to the named beneficiaries.

Other Legacy Giving Options

•	Gifts of Real Estate
•	RRSP's or RRIF's
•	Endowment Funds

If you are interested in more information about legacy giving, please feel free to call MDA at 604.873.0103. We also wish to advise you to consult with your own financial advisor when making your estate plans.