Legislative and regulatory issues of interest to our members. If you would like to view our archived articles, click here.
Important Change to Wisconsin Law
Important change to Wisconsin law regarding issuance of gift annuities, effective April 18, 2014, including removal of registration and on-going reporting requirements and addition of specific disclosure and notice requirements. Click here for more info.
State Regulations - Washington & Wisconsin
Two important changes are currently in the works in Washington and Wisconsin:
Legislation is pending in Wisconsin that would eliminate the need for registration with, and annual reporting to, the Office of the Commissioner of Insurance (OCI). The bill (SB 152) has passed the Senate, and awaits action in the Assembly after the legislative session resumes in January. If adopted, in order to issue gift annuities in the state a charity will need to have been in existence for 3 years and include specific disclosure language in the agreement, but will not need to file anything with the OCI. A charity that is currently registered would be required to send notification of the regulatory change to its existing Wisconsin annuitants.
ACGA's Statement Regarding the House’s Tax Reform Bill
ACGA requests that the House’s tax reform bill:
- Make permanent the IRA/charitable rollover for direct transfers to public charities (expiring this year).
- Expand the IRA/charitable rollover to allow a rollover for charitable life-income plans for donors.
- Provide an option for donors to make charitable contributions by April 15 and elect to deduct them on the prior year’s income tax return (due by April 15 in the year that the election is made).
- For all new charitable remainder unitrusts and annuity trusts, decrease the minimum annual payment to three percent.
Click here to read the full statement.
Conrad Teitell Speaks to the Committee on Ways and Means on Behalf of ACGA
On Thursday, February 14, 2013, Conrad Teitell, volunteer legal council for the ACGA, spoke to the Committee on Ways and Means regarding tax reform and charitable contributions including the ACGA's proposed All-American Charitable IRA Rollover Act. Mr. Teitell addressed four points including asking Congress to: (1) make permanent the provision that allows direct tax-free distributions from IRAs to charity (the so-called IRA/charitable rollover); (2) expand the IRA rollover to include transfers to fund a charitable life-income plan for the donor; (3) eliminate the charitable deduction as one of the deductions subject to the reinstated overall limitation on itemized deductions (the Pease provision); and (4) not place a cap or floor on the charitable deduction - or impose a lower tax rate at which contributions may be deducted. Mr. Teitell summed up by reporting that decreased support from federal, state and local governments and increased burdens on charities make this the time to enact legislation that increases - not decreases - the incentive to make charitable gifts. Charities need the funds now to do their vital work. To read Mr. Teitell's entire statement to the the committee, click here.
Charitable Gift Annuities Exemption Model Act
Note: The following Charitable Gift Annuities Exemption Model Act was approved by the National Association of Insurance Commissioners (NAIC) at its Winter Meeting on 12-07-98 in Orlando, Florida. In early 1999, it was forwarded to the Insurance Commissioners of all 50 states (and the District of Columbia) with its Meeting Minutes, for forwarding to the state legislatures, suggesting that each state legislature choose either it or the Charitable Gift Annuities Model Act and make it a part of the Insurance Law of that state.
Charitable Gift Annuities Model Act
Adopted by the Life Insurance (A) Committee.
Text of Philanthropy Protection Act of 1995
Note: The Philanthropy Protection Act of 1995 prohibits the payment of commissions or remuneration to anyone based on the value of a charitable gift annuity given to a public charity, and also requires the charity to provide a Disclosure Statement to the donor prior to the receipt of the donor's first annuity gift given to that charity. See text of the Law below and the Statement by the National Committee on Planned Giving (NCPG) and the American Council on Gift Annuities (ACGA) on the payment of commissions by a charity in return for a gift annuity - found at http://www.ncpg.org/.
FULL TEXT OF H.R.2519 - 104th U.S. Congress