The Bequest Strategy: Gifting the Death Benefit to Charity via Permanent Life

Gifting the death benefit of a Permanent Life Insurance policy is one of the most cost-effective and leveraged methods for planned charitable giving, allowing donors to create a large legacy with modest, affordable premium payments.

The Leverage of Gifting Insurance

A donor can purchase a Whole Life policy and name a qualified non-profit organization as the sole beneficiary (or even the policy owner). Key benefits for the donor:

• **Affordable Leverage:** A $20,000 annual premium payment can instantly secure a $1 million future gift to the charity.
• **Current Tax Deduction (if owned by charity):** If the charity is named the owner and beneficiary, the donor’s subsequent premium payments may be considered charitable contributions and are deductible (subject to IRS limits).
• **Tax-Free Receipt:** The charity receives the death benefit income-tax-free.

Disclaimer: This content is for informational purposes only and is not financial or legal advice. Charitable giving strategies involving life insurance must comply with specific IRS rules; consult a tax advisor and the charity’s development office.