Regardless of the reason why you have life insurance or whom you have chosen to receive the proceeds, you can always add the Dominican Sisters as an alternate beneficiary to a new or existing policy. If the individual named as the beneficiary of the policy does not survive you, the Dominican Sisters automatically become the recipient of the insurance proceeds.
For example, you could designate that your existing beneficiary will receive 60% of the insurance proceeds and name the Dominican Sisters as the beneficiary of the remaining 40%.
HOW: To add the Dominican Sisters as a beneficiary to an existing policy, simply contact your insurance agent and ask for a “change of beneficiary” form. Then complete the form to include the “Dominican Sisters” as a beneficiary and return it to your insurance company. While no income tax benefits are available for naming the Dominican Sisters as a beneficiary, any funds that are finally paid to the Dominican Sisters will be deductible as a charitable gift for federal estate-tax purposes.
Perhaps you purchased an insurance policy for a specific purpose, but now find that the need for the policy no longer exists. In that event, you may want to consider giving the old policy to the Dominican Sisters.
HOW: A gift can be accomplished by simply completing an “assignment of policy” form obtained from your insurance agent. Because you are transferring the ownership of the policy to the Dominican Sisters, you are entitled to a current charitable deduction for federal income-tax purposes. The amount you can deduct is the “interpolated terminal reserve” value of the policy which your insurance agent can calculate for you.
You may be able to make a significant gift to the Dominican Sisters by purchasing a new life insurance policy with the Dominican Sisters as the beneficiary. If you name the Dominican Sisters as the owner of the policy as well as the beneficiary, the yearly premiums you pay are tax deductible.
WHY: the premiums are deductible as a charitable contribution. For example, if you purchase a single-premium life insurance policy for $5,000 and name the Dominican Sisters as the owner and beneficiary, you would receive an immediate income-tax deduction of $5,000. The policy begins to earn interest on the cash value plus interest in addition to the face amount of the insurance. In this way, you can ultimately make a very substantial gift to the Dominican Sisters.
TANGIBLE PERSONAL PROPERTY
Gifts of tangible personal property include personal property such as art, antiques, collectibles, jewelry, rare books, stamp and coin collections, etc. When gifted to a public charity, such items are deductible at full fair market value as determined by a qualified appraisal if the use of the contributed property is related to the tax exempt purposes of the charity. For example, a gift of books to a literacy center would be deductible.
If the contributed property is unrelated to the tax–exempt status of the charity – for example giving the congregation a stamp collection to sell – then the donor is entitled to a charitable deduction for his or her cost basis in the property.
MUTUAL FUNDS
Mutual Funds can be excellent assets to contribute to the Dominican Sisters.
The fair market value of a mutual fund share is its public redemption price
on the valuation date. Gifts of mutual funds are deductible at their fair
market value up to 30 percent of the donor’s adjusted gross income.
QUALIFIED RETIREMENT PLAN ASSETS
Retirement plan assets can make an excellent charitable gift. Qualified
retirement plans enjoy favorable tax treatment prior to retirement but are
severely taxed at the death of the plan participant.
Primary among the incentives in the CARE Act recently passed by Congress is the IRA Rollover, which would allow individuals to transfer funds tax-free from an Individual Retirement Account or other qualified retirement vehicle to a charitable organization. Under the provision, funds folded into a planned gift could be transferred when the donor reaches age 59½. A direct contribution to a charity could be transferred when the donor reaches age 70½.
PLANNED GIVING
You can arrange to Leave a Legacy
gift through your estate planning. Some planned gifts, like charitable gift
annuities, can provide income to the donor during their lifetime, while the
residual goes to the Dominican Sisters at the death. The Dominican Sisters
follow the suggested rates of the American Council on Gift annuities. For
more information see American
Council on Gift Annuities.
