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Discussion Forum Index --> Tax Questions --> Contribution of insurance.
AAATax (talk|edits) said:
| 9 January 2007
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| Can you claim the cash value of a life insurance policy as a contribution to a 501(c)(3)? The ownership of a life insurance policy was transferred to a church and the beneficiary was also changed to the church.
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Deback (talk|edits) said:
| January 10, 2007
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| When you receive cash from a life insurance policy, you can do whatever you wish with the cash. If you gave it to a church, it would be deductible as a charitable contribution, if you have enough to itemize deductions. If the cash was directly transferred to the church, as in your case, it would be treated the same as if you had received the cash and then contributed the cash to the church.
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AAATax (talk|edits) said:
| 10 January 2007
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| If it is treated as received and then contributed, is gain calculated on the FMV less the basis (i.e. premiums paid)?
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Deback (talk|edits) said:
| January 10, 2007
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| Yes, taxable income is the cash value less premiums paid over the life of the policy. The income should be reported on a 1099-R form.
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