4.4.3 Basic Quiz -- Naming a Charity as Beneficiary

A donor who wishes to maintain ownership over a life insurance policy may merely designate a charity as the beneficiary of the policy.

True False

Naming charity as the beneficiary of a life insurance policy should not trigger any income tax liability.

True False

A donor who designates a charity as the revocable beneficiary of an insurance policy will receive a charitable income tax deduction.

True False

A donor who designates a charity as the irrevocable beneficiary of an insurance policy will receive a charitable income tax deduction.

True False

There are three important parties involved in a life insurance policy - the owner, the insured and the designated beneficiary.

True False

Upon the death of the donor, the donor's estate will be entitled to a charitable estate tax deduction for the value of an insurance policy transferred to charity.

True False

The designated beneficiary of a life insurance policy is the same as the owner of the policy.

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

If a donor transfer ownership of an insurance policy to charity, the charity must hold the policy until the donor's death.

True False

Designating a charity as the beneficiary of a life insurance policy is always a convenient way to make a gift and is a good idea.