Gifts of life insurance

Perhaps the easiest way to make a meaningful gift is through life insurance.In order to qualify as a charitable gift, the charity must become the owner and the beneficiary of the life insurance policy.

Existing contracts

Do you own any $5,000, $10,000, or $25,000 life insurance policies which might be freed from your estate plan for charitable purposes? Gifts may be made of existing life insurance contracts. In this case the ownership of the policy is transferred to Kiwanis which then designates itself as beneficiary. A receipt will be issued at the time of transfer for the net cash value of the contract. You continue to pay the premiums each year. Annually, the charity will also issue a contribution receipt to you for your tax deduction. This method is useful for those wishing to donate but who may now be uninsurable.

New contracts

Another approach is to take out a new life insurance contract. (Subject to insurability,insurance may be obtained up to age 85.) The contract is then absolutely transferred to the charity as owner and beneficiary.You continue to pay the premiums for which the charity will give you an annual tax receipt. Other approaches using life insurance may be undertaken in conjunction with estate planning and capital gains issues but these usually require the advice of a professional advisor.