Charitable Remainder Trusts and Gifts of Residual Interest

Gifts such as charitable remainder trusts and gifts of residual interest allow you to arrange your legacy gift now and receive an immediate tax receipt, while enjoying the interest income (charitable remainder trust) or use of the gifted asset (gift of residual interest) for life.

To establish a charitable remainder trust, you fund the gift by irrevocably transferring assets (a sum of money, securities, bonds or mutual funds) into a trust to be managed by a trustee (a financial institution, yourself, a lawyer or other individual). A trust document names the interest income beneficiary (you or an alternative individual based on one life, joint life, or for a fixed term), and names the Diocese of Toronto as the remainder beneficiary. You receive a receipt based on the net present value of the remainder interest.

For a gift of residual interest, you donate your personal property to the Diocese of Toronto today but continue to use it for the rest of your life, while receiving an immediate charitable tax receipt. Gifts of residual interest can include real estate, art work, books, manuscripts, musical instruments and other tangible assets.

The benefits of a charitable remainder trust or a gift of residual interest:

  1. Your gift is not subject to probate fees and other estate costs. Trust assets are not considered part of your estate and are not subject to the cost and delay of probate.
  2. You receive a charitable tax receipt at the time the gift is made for the net present value of the remainder interest of the trust or the net present value of the property. (Net present value is based on the anticipated number of years you or another assigned beneficiary will receive the benefit from the trust, according to fair market value and the appropriate annual discount rate.)
  3. Experience freedom from investment worries while receiving lifetime income from the donated asset.

For further information, please contact Peter Misiaszek, Director of Stewardship Development, 416-363-6021 ext. 246 (1-800-668-8932).