Life Insurance Bank or Brokerage Accounts
A gift of life insurance could be right for you if:
- Your life insurance policy is paid up or has substantial cash value.
- You have no loan outstanding against the policy.
- Your family is well-provided for by other means.
- You would like to make a gift to Pine Street.
How it works
Option 1: You give your paid-up policy to Pine Street.
As the policy owner, Pine Street Inn will either cash in your policy and use the proceeds, or maintain the policy until it ends and then receive its face amount. This gives you the satisfaction of making a generous gift to Pine Street while having the benefit of no change in your cash flow and saving taxes.
Option 2: You designate Pine Street Inn as a beneficiary of your policy.
When your policy ends, Pine Street will receive some or all of your policy's death benefit, as you have designated. This also gives you the satisfaction of making a generous gift to Pine Street while having the benefit of no change in your cash flow and saving taxes. Better yet, you also retain the ability to change your mind should circumstances in your life change. This is only found in Option 2.
Your life insurance may have a new purpose to serve
You may have purchased a life insurance policy years ago when you wanted to protect your family from financial hardship. Now that your children are grown and independent, your mortgage is paid off, and you have accumulated sufficient assets in your estate to pass on to your family, you may no longer need your life insurance policy for its financial protection.
If this is your situation, consider making a gift of your life insurance policy to Pine Street Inn. The value of your policy can provide generous support to our mission at no out-of-pocket cost to you.
Give a paid-up life insurance policy
A paid-up life insurance policy is a policy that will stay in force without any additional premium payments. A paid-up life insurance policy is a valuable asset and makes an excellent gift.
When you give your paid-up insurance policy to us, we will either cash in the policy immediately and use the proceeds, or maintain the policy until maturity and receive the death benefit of the policy.
Because this kind of gift is irrevocable, you will receive an income tax charitable deduction for the value of your gift at the time you transfer your policy to us, providing tax savings if you itemize.
Make Pine Street a designated beneficiary of your policy
Another great way to make a gift to us with your life insurance policy is to make Pine Street a designated beneficiary of your policy. When your insurance reaches maturity, we will receive the amount or proportion you designate. You can change your designation at any time, giving you the flexibility to revise your gift for any reason.
Because your gift is revocable, you do not receive an income tax deduction at the time you create the designation. Rather, your estate will receive an estate tax deduction for the amount your insurance policy distributes to us.
Justine Grant bought a $250,000 life insurance policy on her own life shortly after the birth of the first of her four children. Her policy has been paid-up for years and her children, who are now in their 30s and 40s, no longer need the financial protection the policy provides. The cash value of her policy is now over $90,000, and she's paid $75,000 in premiums.
Justine has enjoyed a relationship of many years with Pine Street, and would like to honor their relationship with a significant gift. However, she has been reluctant to use her liquid assets to make the gift. When Justine learns that her policy can be put to a new and productive use, she is delighted. She arranges with her insurance agent to donate her policy.
- Justine will earn an immediate income tax charitable deduction of approximately $90,000, providing tax savings if she itemizes.
- Her $250,000 death benefit will not be included in her estate.
- She has the satisfaction of making a generous gift to Pine Street Inn without reducing her income level.
- As the policy owner, Pine Street can either cash in the policy and have over $90,000 to work with immediately, or hold the policy and receive $250,000 as a legacy gift from Justine.
In order to make your gift, you must assign Pine Street all ownership rights to your policy and make Pine Street the irrevocable designated beneficiary of the policy. Usually this can be accomplished by completing a simple form from your insurance provider. Be sure to identify us as: Pine Street Inn
To make Pine Street a designated beneficiary of your life insurance policy, contact your insurance agent to make a change on your policy's designation form. Be sure to identify us as: Pine Street Inn
Pine Street Inn and its staff do not provide legal, tax or financial advice. For such advice, please consult your own professional advisor.