Wednesday, May 1, 2024
Specific Property Gifts

4.4.2 Basic Quiz -- Premium Payment Deductions
In some situations, a donor may transfer a life insurance policy to charity with the hope that charity will not surrender the policy.
     True      False
A donor who makes cash gifts to charity each year will be entitled to additional charitable income tax deductions each year.
     True      False
In some cases, a donor may prefer to make the premium payments directly to the insurance company and remove the charity from the premium paying process.
     True      False
A donor who wants to make a gift of a life insurance policy must create an insurance trust with charity as the remainder.
     True      False
To complete a transfer of an insurance policy, the donor will need to contact the insurance company and fill out the proper change of ownership forms.
     True      False
An individual who decides to surrender his or her insurance policy for cash will realize taxable ordinary income equal to the excess of the policy's value over the cost basis.
     True      False
The transfer of a life insurance policy to charity should not trigger any income tax liability.
     True      False
An outright gift of a life insurance policy will produce a charitable income tax deduction equal to the lesser of the policy's value or the donor's basis in the policy.
     True      False
Many individuals own life insurance at some time in their lives.
     True      False
As an individual's situation changes over time, a life insurance policy may no longer be needed for its original purpose.
     True      False



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