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Freedom to Give
Advantages of the Life Insurance Gift
Present financial responsibilities sometime
limit our capacity to give to causes that are important to us. Today, there
is a new method for friends like you who want to make a significant gift to
Union Gospel Mission.
Options for Making a Gift of Life
Insurance
There are several options available to you for
giving through life insurance. All of the options allow you to make a
significant gift to Union Gospel Mission.
You may give an existing policy, a new policy, or name UGM-GH
as a contingent beneficiary on a current policy.
Giving an Existing Policy
The need for life insurance changes as the
circumstances of your life change. For young families, life insurance is
usually purchased to provide security for loved ones or a personal business
in the event of your death. Security for your children's education or
payment of your home's mortgage are two other important reasons for buying
life insurance.
But as your family matures and your finances
stabilize, the need for some policies change or even disappear. An existing
policy that is not needed can be given to Union Gospel Mission,
providing current tax benefits for your charitable gift.
Bob and Mary Johnston bought a life
insurance policy on Bob when they were young parents with two small
children. Now their children are grown and on their own. Bob and Mary
would like to give this paid-up policy of $100,000 to benefit the work of
Union Gospel Mission, naming UGM-GH as the owner and primary beneficiary.
They will receive a current income tax
deduction equal to the replacement cost of the insurance (usually a major
portion of the cash value). Bob and Mary are pleased they could support
UGM-GH with a gift of this stature.
Purchasing a New Policy
Almost anyone can make a sizable gift to Union
Gospel Mission
by purchasing a new life insurance policy. Life insurance provides an
excellent opportunity to reach your desired level of commitment at a
comparatively low annual cost.
A current gift can be made to UGM-GH
which will purchase a policy with a face amount equal to your desired
commitment level. Union Gospel Mission
would be the owner and beneficiary of the policy. You will receive an
income tax deduction for the amount of your initial gift and any subsequent
gifts to pay annual premiums. It is also possible to make an insurance gift
with a single premium policy.
Margaret Wilson, age 40, has been a
longtime friend an supporter of UGM-GH. Beyond her current level of giving,
Margaret would like to make a significant gift.
By making a gift of life insurance to
UGM-GH,
Margaret can make a future gift of $100,000. For around $1,100 per year
for eight years, she will significantly impact the services provided by
Union Gospel Mission, while also receiving a tax deduction for each year's
gift.
Naming UGM-GH
as Beneficiary
You can also designate Union Gospel Mission
as a primary beneficiary or contingent beneficiary while maintaining
ownership of the policy. By doing so, you insure the proceeds of your
policy are used as you wanted and can change the beneficiary designation at
any time. This arrangement does not entitle you to current income tax
deductions.
There are five ways to name Union Gospel
Mission
as beneficiary:
Sole-Beneficiary -
Union Gospel Mission
receives all policy benefits.
Co-Beneficiary - Policy proceeds are
shared between UGM-GH
and any other beneficiaries you name.
Second Beneficiary - Union Gospel
Mission
receives policy benefits if the first beneficiary predeceases you.
Last Beneficiary - Union Gospel Mission
receives the policy's proceeds if both the first and second beneficiary have
died.
Remainder Beneficiary - Payments
remaining from a policy which pays an annuity to an heir when that heir
does not live to receive the entire income, can be left to UGM-GH.
Replacing Your Charitable Bequest or
Gift to Your Family
If you plan to make a gift to Union Gospel
Mission
in the form of a will bequest of a charitable remainder trust, you can give
a life insurance policy to your children or an irrevocable trust for the
same amount and replace the charitable gift to your family. The asset will
also be removed from your taxable estate.
Purchasing a Policy on Another
If you are uninsurable, you can purchase a
policy on another person, such as a spouse, child, or grandchild. Simply
name Union Gospel Mission
as the owner an beneficiary of the policy (UGM-GH
should apply for the insurance in their life). Because the recipient of
your charitable gift is the owner and beneficiary, you are entitled to tax
deductions on the premiums you pay.
Benefits of a Life Insurance Gift
Freedom - Naming UGM-GH
as beneficiary of a life insurance policy allow you to give more than you
might have believed possible.
Versatility - A gift of life insurance
has many options which allow you to meet your current responsibilities while
also achieving your charitable goals. In addition, making changes in policy
beneficiaries is often much less complicated than changing a will,
establishing a trust, or altering other forms of planned gifts.
Tax Benefits - Current income tax
deductions are available to you if you itemize when the ownership of a life
insurance policy is transferred or given to UGM-GH.
If you retain ownership of the life insurance policy, you are not entitled
to an income tax deduction.
If
you would like further information, a
representative from the Ministry Support
Office will be happy to assist you.
Ministry Support
Union Gospel Mission of Grays Harbor
405 E Heron, PO Box 859
Aberdeen, WA 98520
360.533.1064
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