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Philanthropic solutions using Insurance & Annuities Produced in part by- Brenda McEachren Presented by: B.Comm,LLB, TEPDiana Frizell CFP Frizell & Co.

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Presentation on theme: "Philanthropic solutions using Insurance & Annuities Produced in part by- Brenda McEachren Presented by: B.Comm,LLB, TEPDiana Frizell CFP Frizell & Co."— Presentation transcript:

1 Philanthropic solutions using Insurance & Annuities Produced in part by- Brenda McEachren Presented by: B.Comm,LLB, TEPDiana Frizell CFP Frizell & Co.

2 Trends older demographic gives more inheritances create ability insurance funded gifting tax efficient gifting larger gifts with impact accountability, stewardship

3 Tax Incentives lower tax rates on gifts of shares easier to gift RRSP and insurance 5 yr carry forward increased deduction limits –75% of annual taxable income –100% deduction in year of death

4 Who is Giving? entrepreneur retired large RRSP/RRIF large capital gains extra assets or income community volunteer

5 What to give? Cash Real estate Collections - artwork, coins, antiques life insurance, RRSP, RRIF securities, investment portfolio private company shares

6 When to Give - Now or Later? Maximize benefit to donor maximize benefit to charity match gift with tax liability

7 Why Gift Now? tax receipt gets fully utilized reduces estate tax and probate fees not vulnerable to WVA challenge simplifies estate - no appraisals, auctions, disputes, delays charity puts money to use right away enables donor participation and recognition

8 How to Give personally corporately annually at death

9 Opportunities Stocks and Mutual Funds Gift Annuities RRSP Gift Planning Gifts using Life Insurance Corporate Gifting Private Company Shares

10 RRSP Insured Gifting Mr. & Mrs. B aged 78 & 77 RRIF $134,000 Portfolio $850,000, gain $300,000 tax due on death $130,000 insure the tax bill or eliminate the tax bill

11 RRSP Insured Gifting **** Do NothingAdd InsuranceAdd GiftAdd Gift+Ins RRIF$ Portfolio$ Insurance $130000$200000$ Total Assets$984,000$1,114,000$1,184,000$1,234,000 Net to CCRA$130,000 $69,000NIL Net to Kids$854,000$984,000$981,000$984,000 Net to CharityNIL $134,000$250,000 Annual Cost $4242$6487$8015 Cost of Gift $2245$3773

12 Gift Annuity 78 yr old widow $42,000 annual income $170,000 GIC’s Condo $250,000 Wants to make gift but needs to preserve cash flow

13 Gift Annuity 0Tax Credit 0Donation Receipt 690Net Income 310Tax Payable 1000Income 20,000Investment 5% GIC 5,040 11, ,000 Annuity

14 Insured Gift Annuity **** 69 yr old female n/s Annual income = $45,000 Home $400,000 & GIC’s $300,000 Intends $75,000 gift to charity in will Desires 4% return on her portfolio Tax bracket ~ 31%

15 Insured Gift Annuity 75,000Net to Charity 2090Net Income Life Insurance 2090Net Income 910Tax Payable 3000Income 75,000Investment 4% GIC 100, ,000 Insured Annuity

16 Insured Annuity #2 Mr & Mrs R, both 70 years $450,000 RRIF and $700,000 GIC’s Annual taxable income $80,000 Intend $50,000 gift to charity in will Desire 6% return on portfolio Top tax rate 4 children will inherit balance of estate

17 Insured Annuity # Net to Kids Net Gift Net Income 69250Life Ins Net Income TaxPayable Income 250,000 Investment Insured Annuity5% GIC

18 Apply the tax refund **** Donors giving annually are your main focus Doesn’t matter how much they give Apply the refund resulting from the gift to an insurance premium Leveraging the dollars today for a larger legacy tomorrow

19 Leveraging your gift $3600 annual gift produces a refund of $1530 Male 48 uses the $1530 to fund a life insurance policy for 15 years that pays $80,000 at his death to the charity Female age 60 using that same $1530 could leave $60,000 at death. In addition, they could benefit from a tax receipt on the premiums they pay during their lifetime, or for their estate when the insurance is paid out

20 Summary Identify prospect Identify assets Show them how Work with a qualified Advisor


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