GIVING A GIFT OF LIFE INSURANCE
Turn your life insurance payments into an opportunity to someone experiencing a financial emergency
You can give a gift of life insurance by donating an existing policy or creating a new one.
Gifts of Life Insurance
When you purchase a life insurance policy, and make Brunswick Street Mission both the beneficiary and owner, you will receive a tax receipt for the annual premiums paid. This allows you to make a substantial future gift with considerably reduced after-tax costs.
Exiting policies may also be donated to Brunswick Street Mission. You will receive a tax receipt for the fair market value of the policy. While there may be taxable gains to be reported, as regular income when the policy is donated, the tax credit for the donation will equal or exceed any tax owing. Any subsequent premiums paid on the policy will be eligible for a tax receipt on an annual basis.
A charity may be named as a beneficiary of a policy without transfer of ownership. In this case an immediate tax receipt will be not issued, but your estate will receive a tax receipt when the policy is paid, upon your death. The receipt will produce a tax credit for your final tax return.
Planning for Your Future
There are several ways to make a life insurance gift:
- Purchase a life insurance policy and make a charity both the beneficiary and owner. This option allows you to receive tax receipts for the annual premiums paid.
- Assign an existing policy to a charity. You will receive a tax receipt for any cash value in the policy. There may be taxable gain to report as income but the tax credit could be greater than tax owing due to the donation.
- Name a charity as beneficiary of a policy without transferring ownership. In this case the tax receipt will be issued to the estate when the policy is paid.
A life insurance policy naming a charity as a beneficiary is processed outside of your estate and is not subject to probate taxes or challenges to your will.
Contact Us to Learn More
Should you have any questions or require additional information about gifts of life insurance please do not hesitate to contact us however please be advised that professional advisors are in a unique position to better explore how you can support charitable causes and are an important resource in legacy giving.
All discussions are held in strict confidence and do not require any commitment on the part of the donor.