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Developing a Charity & Ministry Plan

December 10, 2008

At the beginning of the year many of us make resolutions and begin planning for the New Year. This may include planning vacations, completing a will or contemplating a major purchase.

Something all of us should consider is developing a formalized written charity and ministry plan. A charity and ministry plan outlines how we can best use the time, treasures and talents God has given us (Rom.12, 1 Cor. 12). One area to cover is tithing, indicating the church and charities you would like to support financially and then attaching dollars to your support. Consideration should be given to supporting capital projects that may be happening in the causes you believe in, such as a church or school renovation.

A formalized charity and ministry plan also includes assessing your volunteer commitments – finding ways to make a difference that fit with you and your family’s time, treasures and talents. It’s a great idea to get your family involved in the process. For example, one of your family goals may be to do a service project to help the less fortunate. This could be planning a trip to Mexico to help build an orphanage which would take considerable planning. It could also be volunteering locally one evening a month at the Soup Kitchen or a Saturday at a Thrift Store that supports your school.

The next step includes making sure written plans are turned into action which could include setting up a monthly automatic funds transfer (AFT) to the charities you would like to support. There are several reasons to do this.

  • By actively discussing and putting plans into action it will help renew and grow your relationship with your Savior Jesus Christ.
  • Why me? God chose you. God will use you for his purpose – you will be a blessing to others and in turn will be blessed.
  • Financial reasons. With the passing of the 2007 provincial budget, Alberta residents now receive a 50 cent tax credit for every dollar donated to a registered charity over the first $200. If you donate $5,000 to registered charities, a federal and provincial tax credit of approximately $2,500 will be created, so the after-tax cost of the $5,000 gift is only $2,500.Canadians can donate up to 75% of taxable income annually.

Other incentives to contribute to registered charities include new federal tax provisions to exempt capital gain tax for gifts of publicly traded securities. So in addition to the 50% tax credit, the donor would save the net value of any applicable capital gain tax. To facilitate this, Christian Credit Union has the ability to set up trading accounts for registered charities through our credit union partner, Qtrade Online Brokerage.

With recent changes to federal and provincial legislation, it’s also a good idea to review your estate plan (will). By donating to charities in your will you may offset the impact of tax on registered assets such as RRSPs/RRIFs and publicly traded securities. The bottom line is the registered charities receive the money vs. the government. The limit for charitable tax credits is based on 100% of taxable income in the year of death and the year prior to death.

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