While this blog typically focuses on the personal or marketing side of fundraising and philanthropy, I found a very helpful article yesterday that addresses some of the technical planning and administrative aspects around charitable bequests.
Though it does cover more of the technical side, I found it fairly easy to follow and full of useful information for donors and for charities.
I'd also like to make a personal, unsolicited reccomendation of the Charities and Not-for-Profit Division within the Miller Thomson law firm. If you are not already a subscriber, you might want to get on their Charities Update emailing list, which is how this article found me.
I've worked with a number of the lawyers at this firm and what stands out about them is how much they give in terms of free educational information - newsletters, conference presentations, informal conversations - to me their investment in helping fundraisers is a sign of their commitment to the charitable sector in Canada.
Thanks @CharityLawCan @EstatesLaw @SusanManwaring
and the rest of the gang at @MTCharity
Practical Considerations When Making a Charitable Gift by Will
Karen L. Weslowski
, Vancouver(Reprinted with permission from the June 2012 Miller Thomson Charities and Not-for-Profit Newsletter)
A legacy can be created by leaving all or a portion of a person’s estate to charity. Such a gift can reflect a testator’s personal values and beliefs while making a difference in the lives of others. However, in order to ensure that the charitable gift is realized, there are some things for a testator to consider before leaving an estate gift to charity. Once that gift is made, charities may wish to know what steps they must take to protect that gift. The Requirement for a Proper Will
Without a proper Will, a person’s estate will pass on intestacy to their next of kin. However, before a person can make an estate gift to charity, their Will must make some provision for their dependants, if any.
In British Columbia, dependants include a testator’s spouse, minor children and, in most instances, adult children, even if they are financially independent. In most other Canadian provinces, the category of dependants is not as broad and includes spouses, minor children and adult children only if incapable. If a testator’s Will does not make adequate provision for these people, there is legislation in most provinces which permits dependants to commence litigation challenging the Will.
Litigation often results when family members are not informed about a testator’s intention to leave a charitable bequest. Testators should tell their family about their wish to leave an estate gift to charity. Although the charity has a duty to protect the gift, charities may be reluctant to engage in acrimonious and expensive litigation to do so.
The Will needs to be very specific about which charity the testators wish to benefit. For example, if the Will simply provides a bequest to the “diabetes society”, it may be challenged on the basis that the identity of the charity is unclear. This is due to the fact that there are several charities associated with diabetes. Even if the Will is not challenged, a court application may still be required to figure out which charity the testator intended to benefit. This will cost the testator’s estate money that could otherwise go to the charity and the estate beneficiaries. The Charities’ Duty to Protect a Charitable Gift
Charities may become involved in estate litigation by virtue of being a beneficiary of an estate. Common issues that involve a charity are challenges to the Will, applications for interpretation of the Will and passing of the executor’s accounts.
Charities are not always sure what role, if any, they may have in estate litigation. As a beneficiary of an estate, a charity is entitled to notice of any estate proceedings which may affect its entitlement or require its consent. Charities are also entitled (or, in some instances, may be required) to fully participate in the litigation, including settlement of the proceedings.
Charities must ensure that their interests are protected under a Will and by the person administering the estate. Charities must take reasonable steps to ensure that a testator’s gift is realized. This includes monitoring the administration of the estate and making inquiries of the estate solicitor or executor as to the status of the estate. If necessary, it may also include taking active steps in any litigation to protect their interest in the estate.
The need to defend a donor’s charitable gift by becoming involved in litigation can affect the charity’s image. In a fight with disinherited family members, the charity may be perceived as “greedy”. Charities generally want to maintain a positive public image.
This consideration may affect how a charity conducts itself in litigation and cause it to be less assertive in defending a testator’s gift. Although charities have an obligation to defend the donor’s charitable gift, it may not be practical to do so where the amount of the gift is small relative to the cost of litigation. Charities may choose to decline a bequest where the public relations issues resulting from litigation would adversely affect the charity disproportionately to the value of the bequest. Conclusion
Testators should strive for open communication with their dependants as to their intention to leave a gift to charity. This can assist in ensuring that their intended gift is realized and reduce the potential for litigation after the testator’s death. Charities must recognize their duty in protecting charitable gifts and take appropriate steps to that end.
Yep, this one needs a "just in case" disclaimer to let you know that this blog post should not be taken as legal advice. Christina Attard is NOT qualified as a lawyer or financial advisor and information on this website does not constitute advice - please consult with a qualified advisor before proceeding with any legal or financial course of action.
Today was a great day for people like me.
It all started with a long standing Telemiracle
fundraising campaign on TV here in Saskatchewan, Canada. It had all the elements you could ask for from high-drama philanthropy - emotional stories, compelling appeals and amazing corporate participation with just under $1 Million donated by two companies for a total of $5.9 Million raised in just two days. For most of us fundraising professionals, those results would indeed feel like a miracle!
Today, the campaign made front-page news. But this year, it was because of one farmer's legacy gift - a bequest in the amount of $1.46 Million
presented by his son and daughter-in-law. For legacy gift planning evangelists like myself, it was a dream come true to see the positive power of one person's generosity grabbing the attention of so many.
I think practically the whole province was celebrating today! But there's a bit of a dark side to it too... I also heard so many comments today about how this must have been an unusually wealthy person, how it's nice that this happened, but we could never expect to do something like this ourselves, about how the children must feel to have so much taken away from them...
Frankly, this type of thinking makes me go crazy!
Why? Because the beauty of charitable bequests is that a planned gift is well within the scope of what most of us could do for our communities based on our financial capacity. It's not about disinheriting the kids and it's not about being a wealthy, flashy philanthropist. It's simply about being responsible about what we've been lucky enough to receive in life and considering how that could be shared once our own needs and those of our families/friends have been met.
That's what this particular farmer did and he brought joy to many hundreds of thousands of people today as a result.
Today was also my own lucky day. I had the opportunity and the great pleasure of standing up on my little soap box to speak to Saskatchewan about my passion for legacy giving on the radio thanks to Craig Lederhouse
on CBC Saskatchewan's Afternoon Edition. The interview is available online here.
Craig asked me on-air how rich one must be before considering philanthropy. It surprised me, but the story of a homeless man who came to the (financial) aid of one woman who had always stopped to greet him on the street was the first thing to come to mind. That news story can be found here.
Craig was very interested in how fundraisers open the conversation about a legacy gift and I hope my comments in the interview will give some insight into that process. The thing to remember as a fundraiser is that connection, relationship, involvement with the charity were the main factors behind the bequest that made the news today - not tax, not ultra-high-net-wealth, not naming rights.
It's about joy. It's about how you feel when a child or grandchild opens a gift from you. When you know that though your contribution may be small, you are changing the world for the better. Really thinking deeply about whether there is an organization you care deeply enough about to make part of your family and include in your will. There is joy and gladness there for you and for so many others who will remember you by your kindness.
Love to hear your thoughts!
I'm not much of a newspaper person.
BUT I have to admit that I'm regretting not having a subscription to the Globe and Mail
this weekend as they are providing some in-depth coverage on the state of charities and philanthropy. As with most news these days, I heard about this via Twitter
. The Globe and Mail has created, in addition to a number of excellent articles, a great interactive information resource showing giving by the numbers.
The coverage does an excellent job of addressing the need for charities to ask better in a tougher Canadian market and for the public to give smarter by evaluating fit and impact when they give.
I loved this Donation Action Plan
Looking at the various graphs, there are a few key seismic shifts in the Canadian landscape:
1. Those who give are predominantly older individuals with a significant drop in donation dollars coming from those aged 35-44.
2. There is a huge pressure on corporations to use their donation dollars in a more strategic fashion and on the overall, there has been a large drop in corporate charitable contributions
3. Canada still provides strong support for social services with roughly 43% of charity revenue coming from taxpayer's dollars.
Donation dollars from individuals have decreased in recent years and the number of those giving has dropped dramatically.
4. The use of donation tax-shelter schemes
(the majority of which are under heavy scrutiny by the CRA) has been wide-spread enough to actually skew the overall statistics.
Is the system in trouble?
Charities need to be serious about marketing to a new breed of Canadian that is looking for accountability, transparency and impact. The new breed of philanthropists want to see themselves as investors and partners, not ATMs. It's also time to put serious effort into engaging younger generations and building relationships with new sets of donors - how else can the system be sustainable as the bulk of those participating in giving ages?
No one wants to lose the good work done for our society by the thousands of agencies that make life better for Canadians every day. There is clearly interest in giving when it comes with very generous tax concessions (as the popularity of donation tax-shelter schemes has demonstrated). What can we be doing to increase and promote the idea of investing in Canada's charitable sector in a fair and legislated way? Are you, as a donor, seeking out advice about the various (legitimate) ways to give on a tax-reduced basis? Do you regularly evaluate the service and satisfaction that you receive from the charities that you are supporting?
I applaud the Globe and Mail for opening and exploring this topic so intelligently and in such great depth. The third sector remains a bit of a mystery in the public consciousness, but it plays such a vital role in Canadian society.
I'd also like to thank Paul @UinvitedU
for his coverage of the feature via Twitter.
Today, Malcolm Burrows at All About Estates weighed in on the "Strategic Giving" coverage in the Globe and Mail and I wanted to share his insights as part of this discussion.
Have you heard of Michael Chatman
? While we hear from so many brilliant fellow fundraisers, what's unique about Michael's voice is that he speaks from the perspective of a philanthropist. His mission is to celebrate the joy of giving and he shares the stories of his own and other individual's philanthropy. His main medium is a radio program called the Giving Show
, which is available online.
Today, Michael posted a list of his Top 20 Blogs in Philanthropy
, culled from a list of over 350 candidates.
It really highlights the best-of-the-best and also introduced me to a couple of blogs that I hadn't been tuned in to yet.
If you're looking to sharpen your fundraising game this fall, or your giving game, for that matter (!), add a few of these URLs to your morning news reading list.
Thank you to Michael Chatman for creating this great resource!
PS. Stay tuned - I'll be making guest blogger appearances on two of the top 20 blogs listed in the coming weeks.
The term "social entrepreneurship
" has been on my mind all summer thanks to an AFP conference panel on the topic that I attended late in the spring.
The concept of the "double bottom line
" where business and charitable activities can be formally paired and both can profit is a fairly new one for me (though not a new concept in general). It was fascinating to hear some different case studies demonstrating how organizations and investors have worked together to create this result.
What is so fascinating to me is that there is such a personal investment both of time and money in trying to launch this type of venture - I like the combination of volunteerism with philanthropy with entrepreneurial creative thinking. It is also an experiment in whether government, individuals or the free market is best positioned to address social issues.
I understand that in the US, there is legislation coming into place that would allow organizations to categorize themselves as L3C
s - kind of like a hybrid between a charity and a business where both social good and economic development can be combined. One of the panelists at the AFP session in Toronto said that he is aware of a push in Canada to create something similar
This brings me, finally, to the topic of dragons. Namely, Brett Wilson, who is known as both an entrepreneur and a philanthropist and as a "Dragon" co-host of CBC's Dragon's Den
I encountered Brett some years ago at a Calgary Chamber of Commerce breakfast. He wore jeans and plaid in a room full of dark business suits. He was also the guest speaker that morning.
What I liked about him is that for him, being a philanthropist seemed like a matter-of-fact part of his personality. His efforts are considered and strategic, but it appears that he simply assumes that donations and fundraising are part of the deal and should be part of everyone's day to day life. For him, they are an integral part of how he runs his businesses and fit directly into his marketing strategy.
Mr. Wilson is a great real-life study in how a social entrepreneurship style approach can work.
Needless to say, I was thrilled to see this great interview with Mr. Wilson by Donna Messer come up via twitter tonight: Brett Wilson: The Man, The Philanthropist, The Host of Risky Business
The byline? "In Brett Wilson’s view, charitable giving programs are an investment, not an expense. He sees them as investments with long term value. In his opinion, entrepreneurs should have philanthropy as part of their marketing strategy."
- How can charities help (prospective) donors get their "hands dirty" and get them involved and invested personally in their work?
- Can charities demonstrate new and creative ways for donors to partner and invest in their work while offering clear goals, transparency and accountability?
- Can business goals and philanthropic strategy be better aligned?
- How might involving employees or family in strategic philanthropic investments help build community/closeness?
- Is it worthwhile to develop new socially responsible business practices/products in hopes of attracting other social entrepreneurs as investors?
Our family is re-locating this summer. Today, we begin the move from Kingston, Ontario to Regina, Saskatchewan. We'll be in the new home in about three weeks from now. It's one of those monumental moves across the country that will always be talked about in our family.
The reason? After many, many years of studying, writing and teaching, my partner was asked to fulfill his life-long dream of becoming a tenured professor in Regina. It happened at the end of May and the move has happened in a very short time-frame.
My plan is to continue my work in advising charities and donors in Regina and virtually (with some travel) for clients outside of Saskatchewan.
One of the most interesting things I've been reflecting on about this whole process are some of the non-traditional philanthropic aspects:
Transaction Fees for Charities
The real-estate firm that we contracted in Regina to help us find a home just sent a certificate letting us know that they've made a gift to the Children's Miracle Network in our honour as a thank-you for choosing to work with them. I also learned yesterday that the interest that will be earned by our lawyer's trust account on our purchasing funds will be pooled with other earnings and distributed to charities.
Both make me feel great and were a good added bonus in that they allowed us to share some of the financial profits from the sale with members of our former and future communities.
The Mitzvah Circle
Isn't moving all about a lot of good deeds? The help and encouragement from families and neighbors, the meals, that last roll of toilet paper that you had to borrow...
We had live and virtual garage sales over the past week and ended up giving away more than half of what we had. It was a nice feeling to be able to share with others, especially people just starting out, and pay-back some small portion of what was given to us. We spent last evening delivering furniture to students without cars.
I guess it's obvious that some (good) stuff also went to the Salvation Army, which I hope will be helpful for creating good in the community. I learned this winter that it actually costs some charities money to dispose of useless items that are donated and it makes more sense to recycle than donate if the item is damaged beyond use.
Finally, moving also brings people together - the weekend was spent talking for hours with our neighbors just because we were out on the front lawn for two whole days. When we arrive in Regina, I'm sure that it will be much the same.
Keep your fingers crossed for us as we navigate through the boxes and make the transition to our new home in August!
A very popular topic in fundraising circles these days has been the infamous "Millennial Generation" or "Gen Y" and how they are changing the donation game.
I recently attended a Millennial Donor Summit
which was presented as a fully virtual conference. Delegates could interact live with one another and with presenters through video and chat functions.
Today, AFP dedicated a full newsletter
to addressing this very issue.But, why does it matter and what does it all mean?
There seem to be some unspoken fears about this new generation of donors that the conversation is trying to address:
- How can/should charities reach out through social media - a tool most of us still don't understand?
- Will those seemingly detached hoards who float about all day connected to an iPod ever become engaged in their communities?
- What will happen to us all if they are not as philanthropic as other generations?
What is emerging from this huge conversation is that though millennials like to communicate via online media and that while Google might be the first point of interaction with a non-profit or charity, there is little that differentiates them from donors belonging to an older demographic. Millennials also like to be connected with in a personal way, to be engaged and to be given a chance to become passionate, to be involved, to be asked for gifts and to be offered information about the impact of their participation.
From my perspective, now is the right time to be reaching out to members of this new generation of donors and offering opportunities for meaningful involvement and exceptional stewardship. My guest blog post yesterday at The Fundraising Coach website
makes the suggestion that we need to start re-thinking the old rule of measuring engagement by donation-dollar values.
What will this look like when it arrives via text message!
Our most engaged younger donors often fall below the "stewardship radar" because the dollar value of their support can be lower than our wealthiest donors. However, it makes sense to begin investing now in these individuals who are thought-leaders for their own generation if we hope to build a philanthropic culture for the future.
Nothing new, just a need to take the time to offer a personal touch, to step out from behind your website and say "thanks" or offer an invitation to visit, volunteer, join the board...
I was recently invited by the dynamic fundraiser, writer, speaker and blogger Mazarine Treyz at Wild Woman Fundraising in Austin, TX to come over as a guest blogger and share some of my insights about planned giving.
My starting point for writing was Steven R. Covey's
principal that we must first seek to understand, then to be understood. For me, this has become a guiding star'
In my professional practice, I find myself advising individuals about the incredible possibilities that are available for philanthropists to help create a better life and world for others. In order to be able to assist others in this process, I have always felt it important to be an active participant in philanthropy myself and to experience what it is to support the missions of charities that are meaningful to me before offering guidance.
For my guest post, I decided to focus on the experience I had as a gift planner who created a legacy gift. The process took over a year and it taught me some incredibly valuable lessons about how it feels to create a bequest gift. I know that it has created a new understanding for me when I help others who are contemplating this type of gift and I hope my insights might inspire other fundraisers and advisors who haven't joined the legacy gift circle yet themselves to take the leap!Check out my article at Wild Woman Fundraising!
A special thanks to Mazarine for a fantastic opportunity to share my thoughts with her readers! Her website is full of information about building a fundraising program, online marketing and career managment