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How will you leave your success, your estate, to others? The tax bite can leave holes in what you wish to pass on. Just as making a charitable gift makes you feel "whole" inside, planned charitable giving can make your estate whole. Planned charitable giving using life insurance may play a role in your estate planning.
Using a charitable remainder trust (CRT) may provide valuable tax leverage. A CRT offers the unique advantage of allowing the donor to continue enjoying property even though the property has been gifted to charity.
Definition: A charitable contribution is a gratuitous transfer of property to an organization designated by law as a qualified charitable organization. A taxpayer that makes a gift to such a qualified charity can receive triple tax advantages of taking a current income tax deduction, avoiding payment of gift tax, and possibly reducing federal estate taxes.
The Role of Life Insurance
The role of life insurance in charitable giving is growing rapidly. Donors are discovering the many benefits of using life insurance. Premiums, existing policies, new policies, assignments of interests and beneficiary designations are all part of planned giving.
Whether through outright gifts or trust vehicles, donors are maximizing their charitable interests and taking full advantage of estate benefits for themselves and their heirs. Of course, different tax benefits come with different approaches.
Taxpayers already making charitable cash gifts directly can appreciate the great leverage of turning that cash into insurance premiums. Also, contributions can be made of an existing policy or a new policy, or donors can name a charity as beneficiary of an existing policy.
Consider Lincoln Life's products to assist in your charitable planning. Depending on what your specific needs are, we have many products that can fit this need. For a list of products available in New York, click here.
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