Tag: tax driven charitable giving

Peter Gilgan – Power Donor® Extraordinare

Why do I call Peter Gilgan a Power Donor®? 

It’s simple, just imagine a world where everyone donated 1% of their net worth; if you are worth $1 million that would be a $10,000 donation to charity.

Now, imagine donating 8.3% of your net worth in your lifetime to charity using the same net worth calculation – your donation would be $83,000. Well that is just what Peter Gilgan, the founder of Mattamy Homes in Canada did today, adding to his philanthropic record by donating $30 million to St. Michael’s Hospital in Toronto. This donation brings his lifetime giving total to $150 million against his $1.8 billion in holdings.

What can Peter Gilgan’s giving teach us?

It shows that he could never conceive of how much to give if he did not undertake any planning for his finances, his estate and leading to his philanthropy. The same can be said for a recent donor to a local charity who took the time to understand that she lacked personal financial planning. She spoke with us at FUNDING matter inc. to say that she didn’t understand if she had enough money to live the lifestyle she was accustomed to while still providing for her heirs and leaving something to her favourite charities. After walking her through an illustration of a proper estate and financial plan, she quickly understood and saw first hand the looming tax that could be used for charitable giving. In the end she became a Power Donor®,  actually donating more than 1% of her net worth to her favourite charities.

Each professional advisor can leverage their client relationships to help achieve them establish unique and inspiring legacies through philanthropy, much like Peter Gilgan’s recognized legacy of landmark donations to the charitable sector.

William Petruck

www.giftabulator.com

Donate to Eliminate

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I was encouraged to see the Laura Saunders’ article Tax Smart Philanthropy Made Easy in the Wall Street Journal (WSJ). This has been a key element of what we have been speaking to advisors, charities and individuals about in getting their estate, financial houses in order to minimize taxation on their capital gains now and in their estates. Tax planning means that advisors and their clients need to take an inventory of all assets now and over time to ensure that what is left over and taxed can be put to other uses like philanthropy.

 

The WSJ article talks about the increase in popularity of Donor Advised Funds such as those offered by Fidelity, Schwab and Rowe. The other option is to give directly to charity and see the impact of your giving. The Donor Advised Fund model is a very smart approach if you are undecided about which charities you may want to leave your money to, and the taxman is not one of your chosen beneficiaries.  It is also a wise strategy for future generations who will invariably be approached to give to charity.  Imagine having the luxury of helping society with pre-tax dollars.

 

An important element in smart tax planning is being able to see or have someone illustrate to you how lowering taxes can be achieved and what is required.  All too often, advisors do not spend the time to engage in these types of discussions for a number of reasons including, lack of knowledge or not having the tools to educate and illustrate these concepts to their clients.  Not-for-profit organizations are equally guilty of not informing and engaging their members with the information in a concrete manner. That is why historically, the number of bequests to charities has remained in the 4% to 6% range for many years.  Guess who is getting the rest after the family? You got it, the taxman.

 

The solution to this is GIFTABULATOR, an estate, financial and philanthropic planning app with an easy to understand model for planning purposes. GIFTABULATOR easily calculates how much money an individual will be left with, can pass on to their heirs and how much should be donated now or as part of an estate to reduce taxes at any point in the investment cycle. Can you imagine now how much you should give now to reduce your taxes on various assets? Call it Donate to Eliminate.

 

Laura Saunders’ article in the WSJ hits home about leaving a legacy for yourself, your family and your community.

 

Connect with GIFTABULATOR at app.giftabulatorusa.com

 

e. wpetruck@fundingmatters.com