Donating to Charity

What Is a Donation?

Donating

A voluntary gift such as money, services, property, new or used goods (like old cars), assets such as stocks and bonds to a valuable cause, typically for charitable purposes. The donation often called a contribution.

Types of Charitable Donations

Donating to Charity

1- Cash Donations

Cash Donating

There are different ways of making a donation under your will. A cash gift is the simplest and the most obvious.

2- Gifts in Kind

Donating used cars to charity

Instead of a cash gift under your will, you could give for a gift of tangible property (like car donate) to be made to one or more charities. For example, you might consider donating valuable paintings to a public art gallery, a donation of attractive real estate to a provincial conservation authority, or maybe donating a car to a hospital foundation for its use in transporting patients.

3- Using Life Insurance for Charitable Purposes

A few people are worth “more dead than alive” to the charities they support, because they have obtained extra life insurance and nominated the charity as the beneficiary.

4- Charitable Gift Annuities

Another donation practice involves making a cash donation to a charity, in return for a life annuity. Possibly you have your mind made up that you want a capital sum to go to a specific charity after your death. You cannot make the donation now because you need to keep the funds invested to provide you with interest or dividend income to live on.

5- Charitable Remainder Trusts

In some situations a trust can be used to make a donation of property to a charity. A charitable remainder trust involves the creation of a trust under the terms of which a particular charity is named as the capital beneficiary and the donor is named as the income beneficiary. The donor would then transfer one or more assets to the trust. The trustees of the trust would hold the legal title to the property under the terms and conditions spelled out in a written trust agreement.