Donald’s wife has recently passed away. He is now in the process of reviewing his will; he has just set out some objectives for his estate plan. He does not want the family property to be sold and has left the specific assets of the house, and cottage to his children, Sally and Susan, respectively. Other assets include an investment portfolio, with FMV of $500,000 (ACB = 250,000), which they will share equally. However, he now has decided that he wants to leave $100,000 to the hospital that cared so well for his wife prior to her death. In order to ensure that this wish is met, Donald should:

Identify the correct answer. For each answer, explain why it is either incorrect or correct. (5 marks)

1. Purchase a life insurance policy with face value of $100,000 with the estate as named beneficiary.
2. Bequeath $100,000 from the proceeds of the estate to the hospital
3. Leave a request that the children contribute $100,000 to the hospital from their estate
4. Purchase a life insurance policy with face value of $100,000 with the hospital as named beneficiary

Answer rating: 100% (QA)

D Purchase a life insurance policy with a face value of 100000 with the hospital as named beneficiar... View the full answer