Gifts of life insurance are easy to make. They may generate a charitable tax deduction, and they may not disturb other assets or cause a loss of income.
Charitable deductions for gifts of life insurance vary according to the status of the policy.
For a policy that is not paid up, the charitable deduction is generally slightly higher than the policy’s cash surrender value.
If a policy is paid up, the deduction is limited to the present cost of a comparable policy if you went out now and bought a new one.
If you make annual premium payments on a donated policy, the premiums are deductible. If you assign a policy’s dividends to a charity, you can deduct the dividend payments as charitable contributions.
For any questions you may have on a gift of life insurance, please contact us. We will be glad to help you.