CHAR IT Y
CHECKLIST
Working with Charities
When Planning a Bequest
Malcolm D. Burrows,
Scotia Private Client Group
When planning an estate, should you
contact the charitable beneficiaries to
inform them of a bequest? Traditionally, the answer to this question has been
“no”. But practice is changing. Charitable
advisors assess charities as recipients of Does the charity trade or sell names to
significant donations and partners in the other charities or organizations?
gift planning process. The checklist may
6) Donor recognition: Are donors of
be used when phoning a charity to request
bequests and planned gifts recognized
the legal name for a will or other planning
after the gifts are received? Does the
bequests are becoming more common, situations. It may also be helpful in situa-
charity have an optional program to recog-
donors more knowledgeable, and charities tions when the client asks the advisor to
nize and involve future gift donors while
more sophisticated.
make anonymous inquiries about techni-
they are still alive?
cal or recognition issues.
As a general rule, it is advisable to
7) Staff Gift Planner: Does the char-
contact charitable beneficiaries anony-
1) Policy on use of planned gifts and
ity have a staff Gift Planner or Planned
mously to ensure your lawyer has the bequests: How does the charity use un-
Giving Officer? Does he or she have any
correct legal names. An incorrect name or designated bequests and planned gifts?
professional designations? Has the planner
designation could cause your gift to fail, Are they spent immediately or are they
adopted the Canadian Association of Gift
which creates legal costs for your estate endowed? Are they used to pay a deficit,
Planners’ Standards of Ethical and Profes-
and trouble for your executor and other support administration, or pay for the
sional Conduct?
beneficiaries. The Canadian Donor’s Guide direct programs and services of the charity?
is the perfect first step in this process.
8) Other Types of Planned Gifts: Does
2) Accountability: Are the charity’s
the charity help donors explore tax-
Considering you are planning the larg-
annual report and audited statement
advantageous alternatives to bequests,
est gift of your life, it is important to ask available to the public? Will the charity
such as charitable gift annuities, life insur-
a few searching questions of your intend-
send the annual report to the donor after
ance, gifts of RRSP/RRIFs, and charitable
ed beneficiaries. Ask about the charity’s the gift is confirmed?
remainder trusts.
finances and how your gift is most likely
3) Gift designation: Does the charity
to be used. For example, does the char-
While the issues on this checklist will
allow donors to designate to a particular
vary in importance to each person, the
ity offer bequest donors the opportunity to
area or activity?
name something after their family, a loved
key consideration is how the charity deals
one, or themselves? This kind of recogni-
4) Personal endowment funds: Does with an engaged, questioning donor or
the charity have a permanent endowment advisor. Most charities appreciate passion-
tion can be a deeply meaningful option,
where the capital of the bequest is kept ate donors, so please, go ahead, ask tough
but you need to involve the charity to
ensure wishes will be met.
intact and only the income is spent annu-
questions. Ultimately, trust is the most
ally? Are donors able to name endowment important factor in a donor’s relationship
In complex situations, it may be desir-
funds with their bequest? If so, is there with a charity. Trust should be earned, not
able for you and your advisors to meet
a minimum contribution level to estab-
assumed.
with a representative from the charity to
lish the fund? Does the charity provide
Malcolm D. Burrows, CFRE
discuss planning options. Larger charities
donors with financial and activity reports on
Head
will have a Gift Planner on staff and will
individual endowment funds?
meet in confidence. Charities are often a
Philanthropic Advisory Services
source of valuable tax and personal plan-
5) Privacy Policy: Does the charity have Scotia Private Client Group
ning information on charitable giving.
Due Diligence Checklist
a privacy policy? Can a donor remain
anonymous? How is anonymity defined
Malcolm is a charitable gift planner with
(i.e. who in the charity will know about
The following due diligence checklist is a donor’s gift plans)? Can the donor spec-
19 years experience, including over 14
intended to help donors and professional ify no solicitations or unwanted contact?
working for major charities.
