Making gifts to institutions, like universities, hospitals, faith-based organizations, or non-profits, is a great way to utilize accumulated wealth and enhance your client’s legacy.
Giving directly can significantly reduce the amount of assets ultimately passed to family members and other loved ones.
If your client donates directly to an institution, it would reduce their net worth by the amount gifted. Instead, consider donating the premium amount needed to fund a Life Insurance policy to the institution. The institution then uses the donations to purchase the Life policy on your client.
This would reduce your client’s current net worth by just the premium amount and may qualify them for a current income tax deduction. This strategy is a smart way to leverage assets for charitable giving.
It’s important to consider that the charitable organization must be willing to use the donated premium to purchase, own, and be the beneficiary of the Life Insurance policy.
Federal Income tax deductions apply only to gifts to a charity or charitable organization, require itemizing, and may be subject to limits and phase outs. The design of the Life Insurance plan should be considered on a short pay basis and each premium must be paid in full because any variation in donation amount will affect the death benefit and could potentially cause the policy to lapse.
Clients that have a high net worth and have a personal need to aid a charity hope to take advantage of the tax benefits of such a donation, so they must consider the various options. Help them understand the benefits of a charitable gift using Life Insurance today.
Please contact your Life Sales Marketing Manager for more information on this sales idea or any other Life sales information.
Excellence, Passion, Integrity, Collaboration and Creativity – our core values since 1974
The EPICC Center is the online source for financial professionals, designed to provide them with the essential elements they need to run their practice and increase their bottom line including breaking news, carrier / product information, market trends, sales ideas, marketing tools & resources and more.