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Carl and Cathy are well aware of the substantial tax advantages of making charitable contributions as well as the good feeling they get by helping their favorite charity. In addition to their annual contributions, they would like to bequeath more substantial amounts to their chosen charity in their wills. Some of their more affluent friends do this. However, Carl and Cathy do not feel that they are able to.
They would like to endow their favorite charity at a relatively low cost and get some tax relief in the process. Life insurance may offer an answer to both these wishes.
The procedure is quite simple. They apply for insurance on their lives, or use existing policies, naming the charity as the new owner and beneficiary. They pay the premiums and the charity gives them a tax-deductible receipt each year for the amount of the premiums paid.
Some reasons life insurance is particularly well suited as a vehicle for making this special gift are:
The whole concept of charitable giving through life insurance is based upon the understanding that the premium donations are expected to be in addition to the donor's current support.
*Fictional characters for illustrative purposes only.
Copyright © 2020 Life Letter. All rights reserved. For informational purposes only and is based on the perspectives and opinions of the owners and writers only. The information provided is not intended to provide specific financial advice.. Readers are advised to seek professional advice before making any financial decision based on any of the ideas presented in this article. This copyright information presented online is not to be copied, or clipped or republished for any reason. The publisher does not guarantee the accuracy and will not be held liable in any way for any error, or omission, or any financial decision.