Life insurance allows you to make a much larger gift to Spenser's Hope than you might otherwise be able to afford. Although the cost to you (your premiums) is relatively small, the amount Spenser's Hope will receive (the death benefit) can be quite substantial.

As long as you continue to pay the premiums on the life insurance policy, Spenser's Hope is guaranteed to receive the proceeds of the policy when you die. The amount of the death benefit is fixed (or in the case of cash value insurance, perhaps even increasing), and is not subject to market fluctuations or loss of principal. Since life insurance proceeds paid to a charity are not subject to income and estate taxes, probate costs, and other expenses, Spenser's Hope can count on receiving 100 percent of your gift.

Depending on how you structure your gift, you may be able to take an income tax deduction equal to your basis in the policy or its fair market value, and you may be able to deduct the premiums you pay for the policy. In addition, an outright gift of life insurance is typically sheltered from gift tax by the charitable gift tax deduction, as long as you're giving a complete interest in the policy.

If you're worried about estate taxes, you can structure your charitable gift of life insurance to meet your needs. For instance, you can structure your gift so that the proceeds of the policy are not included in your gross estate. Or, you can structure your policy so that the amount of the proceeds payable to Spenser's Hope can be deducted from your gross estate.

Ways to give life insurance to Spenser's Hope

• Name Spenser's Hope as beneficiary on your life insurance policy - This is the simplest way to use life insurance to give to Spenser's Hope. You, as owner of the policy, simply designate Spenser's Hope as beneficiary. Designating Spenser's Hope as beneficiary may allow you to make a larger gift than you could otherwise afford. If the policy is a form of cash value life insurance, you still have access to the cash value of the policy during your lifetime. However, this type of charitable gift does not provide many of the other tax benefits of charitable giving because you retain control of the policy during your life. Upon your death, the proceeds are included in your gross estate, although the full amount of the proceeds payable to Spenser's Hope can be deducted from your gross estate.

• Name Spenser's Hope as the recipient of dividends - Another simple way of making a charitable gift is to assign the dividends on your existing policy to Spenser's Hope. You, as owner of the policy, simply make this designation at the time of application, or at any other time while you own the policy. By assigning your dividends to Spenser's Hope you are able to make a charitable gift. You retain control over the policy and its cash value during your life. You also receive an income tax deduction as dividends are paid to Spenser's Hope. However, this type of charitable gift does not provide many of the other tax benefits of charitable giving because you retain total control of the policy. Proceeds are included in your gross estate, and there's no offsetting estate tax deduction because the proceeds do not go to Spenser's Hope.

• Donate an existing life insurance policy to Spenser's Hope - In order to donate an existing life insurance policy to Spenser's Hope, you must assign all rights in the policy to Spenser's Hope. You must also deliver the policy itself to Spenser's Hope. By doing this, you give up all control of the life insurance policy forever. This strategy provides the full tax advantages of charitable giving because the transfer of ownership is irrevocable. You may be able to take an income tax deduction equal to your basis or its fair market value. The policy is not included in your gross estate when you die, unless you die within three years of the transfer. In this case, your estate would get an offsetting charitable deduction.

• Donate a new life insurance policy to Spenser's Hope - In order to use this strategy, you would purchase an insurance policy, and immediately assign all rights in the policy to Spenser's Hope. You would also deliver the policy itself to Spenser's Hope. You would pay the premiums and if structured properly, be able take a charitable deduction for those premiums.

Please email us at donations@spensershope.com if you are interested in making a gift of life insurance to Spenser's Hope.  Thank you very much for making Spenser's Hope a part of your charitable plans.