Gifts of Existing Life Insurance

Gifts of Existing Life Insurance:

Parishioners can make planned gifts by the assignment of annual dividends paid on their life insurance policies or make out-right  gifts of policies that may have served their purposes. This is sometimes the ideal source of funds to make current gifts. As the donor's children mature, family protection may lower longer be needed. When the mortgage is paid off, mortgage insurance is no longer needed. When a business interest is sold, life insurance held for business reasons the longer needs to be held. If assets have been accumulated for retirement, life insurance may not be needed. Life insurance protection that was purchased to protect a beneficiary who predeceased the policyholder in death sometimes makes an ideal gift. These "used" life insurance policies help guarantee money needed for education, parish needs, the House of Charity, our compassionate outreach program, medical aid, shelters, and if not used for these purposes, they can bring satisfaction to motivated givers.

 For example: suppose  Mr. and Mrs. IloveStAndrew  had a $100,000 ordinary life insurance policy on which they were paying annual premiums of $3500 a year.  The policy originally had been purchased to provide money for the education of their daughter; however, their daughter died prematurely and the life insurance policy was never used for that purpose.  She was a musician who loved to sing and play in church, and Mr. and Mrs. IloveStAndrew decided to transfer the ownership of the policy to the parish  as an outright gift to establish a memorial to their daughter, and to benefit the music ministry of the parish.  Other primary motivators were to provide support for the parish music ministry, likewise, certain tax benefits also come with this kind of transfer.  The parish may surrender the policy for its cash surrender value and dividends, or the policy could be continued in force and paid for by the parish or by  Mr. and Mrs. ILoveStAndrew, who could take certain tax deductions. Advice of appropriate tax counsel should be soft.

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