It is possible to designate a charity as the beneficiary of the death benefits of a life insurance policy.
There are two ways to make such a donation without penalizing your heirs:
- Designate the Foundation as beneficiary of the life insurance.
- The life insurance policy is assigned to the “Fondation québécoise du sida”, which becomes the owner and beneficiary of the policy.
- This can be used to offset your annual income tax contribution as long as you pay the annual premium on this policy.
- The Foundation issues an official receipt to the donor’s estate, which becomes a 100% deductible tax credit and any excess amount may apply to the return for the year prior to the donor’s death.
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