For individuals looking to make a substantial gift to the Timmins and District Hospital Foundation, an irrevocable charitable remainder trust may be considered.

• A donor establishes charitable remainders trust by transferring property to a trust.  This entitles the donor to the use of the property and all of the trust’s income.
• The T&DH Foundation, as the irrevocable beneficiary of the trust, is entitled to the capital of the trust upon the donor’s death.
• Any income paid to the donor from the trust will be taxable to the donor and the donor cannot remove any capital from the trust.
• Upon establishment of the trust, the donor may realize a capital gain or loss on the property donated.
• The donor receives a charitable donation tax credit based upon the trust’s residual interest, in essence an amount calculated based upon the donor’s life expectancy and the trusts fair market value.
• If the donor is married the trust should be set up as such that the assets of the trust do not pass on to the charity until (after) both spouses pass away. 

Due to the complexities involved, professionals such as estate and trust lawyers must be utilized.  It is suggested that donors do not consider this type of gift unless planning a gift in excess of $200,000.

Advantages:

Donor

• The donor receives significant tax relief during their lifetime.
• The donor is provided with an additional source of income.
• Control and use of the assets are retained by the donor.  For example how the trust(s) assets are invested to generate income or the donor can use the property, if capital property.
• Assets held in the trust are not subject to probate fees.
• Donations cannot be contested by the estate.

Timmins and District Hospital Foundation

• Since the beneficiary of the charitable remainder trust cannot be revoked, the T&DH Foundation will receive immediate legal title to the property.

Drawbacks:

• Cost – charitable remainder trusts can be complex and require professional legal advice.
• Size – experts recommend a minimum of $200,000. 
• The charitable beneficiary designation cannot be revoked.
• Capital placed into the trust cannot be removed.
• A transfer of property to the trust may result in a taxable capital gain.