Wills and Bequests: The Most Popular Planned Giving Vehicle

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The most common form of planned gift is the bequest – making a gift through one’s Will. (i.e. Through your estate planning.)  Indeed, some 80% to 90% of planned gifts are bequests.

For these Donors, the bequest is one of the smartest options.  Leaving a gift by Will permits a Donor to leave a significant gift in the future to benefit the Canadian Medical Foundation all the while providing for their present and future financial security.

As another advantage, if one makes a bequest, a Donor’s estate is entitled to a tax receipt for the full value of the gift, thereby reducing the taxes on the estate that are payable.

Intestacy (Dying without a Will or Estate Plan)

When you die without a Will, you are deemed by law to have died intestate.  Intestacy is an unattractive outcome for most people because the government decides how their estate is to be administered.  The law divides the intestate’s estate and thereby determines how much each of one’s heirs will receive.  Charity receives nothing.  For most people, the government having that complete control over the division of their assets is unacceptable.

With a Will, the Donor (in law, called the “Testator”) is provided with a great deal of flexibility.  A significant contribution to the Canadian  Medical Foundation can be made, without the Donor having to sacrifice any financial security during his or her lifetime.

Indeed, a Will allows the Testator to make his or her own decisions, among other things, about the following matters:

  • Who will receive the distributions of his or her estate;
  • The appointment of guardians for minor children; and,
  • The determination of whom will be his or her Executor.

Types of Bequests

The most common types of bequests are the following ones:

  1. A Specific Bequest: With this type of bequest, the Canadian Medical Foundation would receive a specific dollar amount or a stated proportion of the Testator’s estate. (E.g., “I give to the Canadian Medical Foundation…”)
  2. A Contingent Bequest: With this type of bequest, the Canadian Medical Foundation would receive all, or a share, of the Testator’s estate only in the event of the prior death of other named beneficiaries. (E.g., “If my spouse pre-deceases me, then my entire estate – or, one-third of my estate, not to exceed $5,000, etc. – to the CMF…”)
  3. A Residual Bequest: With this type of bequest, the Canadian Medical Foundation would receive all, or a percentage, of the remainder of a donor’s estate after other specific legacies have been fulfilled. (E.g., “I give to the CMF, 5% of the remainder of my estate, to be used at the discretion of the CMF’s board of governance….”)
  4. A Trust Remainder Bequest: With this type of bequest, the CMF would receive all or part of the principal of a trust established in the Will to benefit named beneficiaries, upon the death of those beneficiaries. (E.g., “Upon the death of named beneficiaries receiving income from a trust established herein, all or a part of the remainder of the trust to go to the Canadian Medical Foundation.”)
  5. A Restricted Bequest: Funds are restricted to the use designated. (E.g., “I give $10,000 to support physician health and wellness programs in Canada…”)