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This episode provides an extensive overview of the legal and practical considerations for Canadian charities accepting cryptocurrency donations.It confirms that charities can accept crypto, but must treat it as a gift-in-kind for tax purposes, requiring immediate conversion to Canadian dollars to issue official tax receipts and determine fair market value.
The discussion explores the benefits of attracting a new, younger donor base and reducing transaction fees, while also warning about significant challenges such as the volatility of crypto, the technical complexity involved, and the enhanced audit risk posed by the Canada Revenue Agency (CRA).
Ultimately, the episode recommends that small charities should cautiously weigh the compliance costs against the benefits, often suggesting they avoid accepting crypto unless dealing with very large donations, while medium to large organizations might consider it with the proper legal and technical infrastructure.
The discussion also offers historical context on past Canadian recessions and highlights "silver linings," such as the stability of a foundation and donor-advised funds.
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