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# Wednesday, 24 March 2010
Wednesday, 24 March 2010 14:27:24 (GMT Standard Time, UTC+00:00) ( General Life )
The January earthquake in Haiti, followed shortly afterward in February by a major earthquake in Chile has shown just how charitable donations are essential and necessary world-wide. Haiti was struck by the most powerful earthquake it has seen in a century with a magnitude of 7.0. Chile was struck by a very destructive 8.8 magnitude earthquake. These 2 earthquakes alone left millions of people homeless and without food and water; thousands have sadly also died.

Fortunately, Canadians and people from all corners of the world swiftly began to donate money, as well as medical supplies and food. People also donated their time and expertise, from soldiers to doctors, nurses, etc. Due to the generosity of people all across the world, lives were saved and rebuilding will be able to begin.

The Canadian Revenue Agency offers tax deductions for donations to qualified charities as an extra incentive for Canadians to donate money and/or property. Donations that are made to Canadian registered charities or other qualified donees may help reduce the amount of income tax paid at the end of the year; make sure the charity qualified by visiting the CRA website. The Income Tax Act permits qualified donees to issue official donation receipts for donations received; qualified donees include:

•    Registered Canadian charities;
•    Registered Canadian athletic associations;
•    Tax-exempt housing corporations resident in Canada that only provide low-cost housing for seniors;
•    Municipalities in Canada under proposed legislation for gifts made after May 8, 2000, municipal or public bodies performing a function of government in Canada;
•    The United Nations and its agencies;
•    Prescribed universities outside of Canada;
•    Charitable organizations outside of Canada to which the Government of Canada has made a donation to in the tax year, or the previous tax year;
•    The Government of Canada, a province and/or a territory.

In order for a donation to be eligible as a tax deduction, ownership of property (cash, gifts in kind such as goods, land, securities, etc.) must be transferred voluntarily. Donations can be in the form of money, securities, land, properties, as well as life insurance policies. Gifts of services are not considered property and do not qualify for an official donation. If the registered organization/charity provides something of value in return for a monetary donation, the eligible amount of the donation for income tax purposes is usually reduced. The amount will be reflected on the official donation receipt; the monetary value of the gift to the donor will be subtracted from the amount donated. Currently, the first two hundred dollars donated is eligible for a federal tax credit of 15% of the donation; the federal tax credit increases to 29% of the amount over two hundred dollars. Donors are also eligible for a provincial tax credit; this varies among provinces.

To learn about how to use your life insurance to donate to charity, please visit our page on Charities and Life Insurance which has in-depth information on this topic.

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