Charitable Gift Annuity
Donation of amount "A," made by donor X to a charity. The charity agrees to pay donor X an amount ("B") for the rest of donor X's life. Since the donation is used to fund an annuity, only a percentage of the donation can be taken as a tax-deductible gift in the year of the donation. The percentage taken is based on the Internal Revenue Service tables at the donor's age at the time of the donation. This gift is irrevocable. Since the donor is dependent on the charity to make the income payments, the donor should ascertain the financial ability of the charity to make those income payments. Thus, such an annuity permits the donor to transfer appreciated property to a charitable organization in exchange for the organization's promise to pay a continuous stream of income.
Popular Insurance Terms
Health insurance contract that is renewable at the option of the insurer. On the anniversary date of the contract, the insurer has the right to decide whether or not to renew. ...
Time limit on the deferred ownership of property such that, 21 years after the property owner dies, the deferred ownership of that property terminates. ...
Discharge of electricity from the atmosphere, one of the perils covered in most fire insurance policies. ...
Federal agency that regulates commerce across state lines. The ICC does not oversee insurance, which is subject to regulation by the states according to Public Law 15, McCarran-Ferguson ...
Authority that administers state laws regulating insurance and licenses insurance companies and their agents. ...
Arrangement under which the insured pays a fixed premium to the insurance company in exchange for the total transfer of the risk to that company. ...
Approach that maintains injury or sickness begins when it is first detected by an obvious appearance. This argument is used in determining if liability insurance is afforded in a particular ...
Coverage in the event an employee is kidnapped from an insured business's premises and forced to return to aid a criminal in a theft. ...
Expenses taken out when benefits are paid. For example, a specific dollar amount is subtracted from a monthly income payment for company expenses. ...
Have a question or comment?
We're here to help.