Loading the player...

DEFINITION of 'Charitable Gift Life Insurance'

A method of contributing to charity by taking out life insurance on yourself with the charity as a beneficiary. Using charitable gift life insurance may allow donors to amplify their giving power. Rather than giving large cash gifts as part of a will, some donors find it easier to simply pay the life insurance premiums.

BREAKING DOWN 'Charitable Gift Life Insurance'

Using charitable gift life insurance means the donor does not get a tax deduction for the premiums paid. However, the amount of the death benefit paid to the charity will be deductible for estate tax purposes. Charitable gift life insurance may also be less likely to cause probate disputes, since the intention to make the gift is clearly laid out by the insurance contract.

RELATED TERMS
  1. Immediate Beneficiary

    A beneficiary designation most commonly used in charitable gift ...
  2. Life Income Plan

    A type of philanthropic strategy where cash or property is transferred ...
  3. Fractional Gift

    A gift that provides a fractional interest in an artwork today, ...
  4. Gift Tax

    A federal tax applied to an individual giving anything of value ...
  5. Life Insurance

    A protection against the loss of income that would result if ...
  6. Gift In Trust

    An indirect bequest of assets to a beneficiary by means of a ...
Related Articles
  1. Insurance

    Using Life Insurance To Make Charitable Donations

    Your life insurance policy can be a great tool for charitable giving. Find out how.
  2. Taxes

    What Are Gift Taxes?

    If you're not sure what gift taxes are, read on and we'll explain.
  3. Financial Advisor

    How to Use Life Insurance to Manage Legacies

    These are some of the legacy-building ways that life insurance policies can be used.
  4. Financial Advisor

    How to Grow Your Business with Donation Strategies

    Advisors who offer clients expertise in how to charitably donate will likely build a stronger practice and capture more business. Here's why.
  5. Insurance

    The Dangers Of Stranger-Owned Life Insurance

    Find out how these policies can be used to abuse the system that many people rely on for protection.
  6. Taxes

    Fund a Lifetime of Giving with Donor Advised Funds

    Donor advised funds can have tremendous tax, cost and administrative benefits.
  7. Taxes

    How to Give a Tax-Saving Gift Before The Year Ends

    Giving to charity and family members before year-end can help you save on 2016 taxes.
  8. Retirement

    Gifting Your Retirement Assets To Charity

    There are several things to consider when it comes to this type of charitable giving. Make sure you're well informed.
  9. Retirement

    Does Life Insurance Make Sense When You Retire?

    Whether you need life insurance in your retirement depends on your existing insurance and your goals for passing on your wealth.
  10. Investing

    Putting Your Money to Work for the Greater Good

    There are several ways to put your capital to work for social or charitable causes, while also facilitating moves that support your personal finance goals.
Hot Definitions
  1. Leverage

    1. The use of various financial instruments or borrowed capital, such as margin, to increase the potential return of an investment. ...
  2. Trumponomics

    Trumponomics is a term for the economic policies of President Donald Trump.
  3. Universal Health Care Coverage

    An organized healthcare system that provides healthcare benefits to all persons in a specified region. Many countries, such ...
  4. Davos World Economic Forum

    The annual meeting of the World Economic Forum hosted at Davos—a small ski town in Switzerland—in January each year is among ...
  5. Smart Home

    A convenient home setup where appliances and devices can be automatically controlled remotely from anywhere in the world ...
  6. Efficient Frontier

    A set of optimal portfolios that offers the highest expected return for a defined level of risk or the lowest risk for a ...
Trading Center