State Codes and Statutes

Statutes > North-carolina > Chapter_58 > GS_58-3-6

§58‑3‑6.  Charitable gift annuities.

(a)        A charitableorganization as described in section 501(c)(3) or section 170(c) of theInternal Revenue Code or an educational institution may receive a transfer ofproperty from a donor in exchange for an annuity payable over one or two lives,under which the actuarial value of the annuity is less than the value of theproperty transferred and the difference in value constitutes a charitablededuction for federal tax purposes.  The issuance of the annuity by a charitableorganization does not constitute engaging in the business of insurance if theorganization, when the annuity agreement is issued:

(1)        Has a minimum of$100,000 in unrestricted cash, cash equivalents, or publicly‑tradedsecurities, exclusive of the assets contributed by the donor in return for theannuity agreement;

(2)        Has been in active,continuous operation for at least three years or is a successor to or affiliateof a charitable organization that has been in active operation for at leastthree years; and

(3)        Includes thefollowing disclosure clause in each annuity agreement issued on or afterNovember 1, 1998: "This annuity is not issued by an insurance company, isnot subject to regulation by the State of North Carolina, and is not protectedor otherwise guaranteed by any government agency or insurance guarantyfund."

Subdivisions (1) and (2) ofthis subsection do not apply to an educational institution that was issuingannuity agreements prior to October 30, 1998 nor to an organization formedsolely to support an educational institution in active operation at least threeyears prior to October 30, 1998.

(b)        A charitableorganization or educational institution that issues a charitable annuity shallnotify the Department by January 1, 1999, or within 90 days of issuing itsfirst annuity, whichever is later.  The notice shall be signed by an officer ordirector of the organization or educational institution, identify theorganization or institution, and certify that the organization or institutionis a charitable organization or educational institution and that its annuitiesare issued in compliance with the applicable provisions of subsection (a) ofthis section.

(c)        A charitableorganization that issues charitable annuities must make available to the Commissioner,upon request, a copy of its Internal Revenue Service Form 990 or Form 990‑EZfor the most recent fiscal year for which the due date has passed.  If theorganization was not required to file either form with the Internal RevenueService for the preceding fiscal year, or was allowed to submit the form inabbreviated format, it shall make available to the Commissioner, upon request,the same information that would have been required to have been filed under theForm 990, in a similar format as specified by the Commissioner.  A copy of theForm 990, or corresponding substitute information as authorized by theCommissioner, shall be made available to the prospective annuitant at the timeof the initial solicitation of the contribution, and updated information shallbe made available at the time of execution of the annuity agreement.

(d)        The Department mayenforce performance of the requirements of this section by notifying theorganization or institution and demanding that it comply with the requirementsof this section.  The Department may fine an organization or educationalinstitution, up to $1,000 per annuity agreement, for failure to comply afternotice and demand from the Commissioner.

(e)        A charitable giftannuity issued by a charitable organization or educational institution prior toOctober 30, 1998 does not constitute engaging in the business of insurance.

(f)         For purposes ofthis section, an "educational institution" means a public or privatecollege, university, or community college that maintains a faculty to provideinstruction to students.  (1998‑211, s. 1(b).)

State Codes and Statutes

Statutes > North-carolina > Chapter_58 > GS_58-3-6

§58‑3‑6.  Charitable gift annuities.

(a)        A charitableorganization as described in section 501(c)(3) or section 170(c) of theInternal Revenue Code or an educational institution may receive a transfer ofproperty from a donor in exchange for an annuity payable over one or two lives,under which the actuarial value of the annuity is less than the value of theproperty transferred and the difference in value constitutes a charitablededuction for federal tax purposes.  The issuance of the annuity by a charitableorganization does not constitute engaging in the business of insurance if theorganization, when the annuity agreement is issued:

(1)        Has a minimum of$100,000 in unrestricted cash, cash equivalents, or publicly‑tradedsecurities, exclusive of the assets contributed by the donor in return for theannuity agreement;

(2)        Has been in active,continuous operation for at least three years or is a successor to or affiliateof a charitable organization that has been in active operation for at leastthree years; and

(3)        Includes thefollowing disclosure clause in each annuity agreement issued on or afterNovember 1, 1998: "This annuity is not issued by an insurance company, isnot subject to regulation by the State of North Carolina, and is not protectedor otherwise guaranteed by any government agency or insurance guarantyfund."

Subdivisions (1) and (2) ofthis subsection do not apply to an educational institution that was issuingannuity agreements prior to October 30, 1998 nor to an organization formedsolely to support an educational institution in active operation at least threeyears prior to October 30, 1998.

(b)        A charitableorganization or educational institution that issues a charitable annuity shallnotify the Department by January 1, 1999, or within 90 days of issuing itsfirst annuity, whichever is later.  The notice shall be signed by an officer ordirector of the organization or educational institution, identify theorganization or institution, and certify that the organization or institutionis a charitable organization or educational institution and that its annuitiesare issued in compliance with the applicable provisions of subsection (a) ofthis section.

(c)        A charitableorganization that issues charitable annuities must make available to the Commissioner,upon request, a copy of its Internal Revenue Service Form 990 or Form 990‑EZfor the most recent fiscal year for which the due date has passed.  If theorganization was not required to file either form with the Internal RevenueService for the preceding fiscal year, or was allowed to submit the form inabbreviated format, it shall make available to the Commissioner, upon request,the same information that would have been required to have been filed under theForm 990, in a similar format as specified by the Commissioner.  A copy of theForm 990, or corresponding substitute information as authorized by theCommissioner, shall be made available to the prospective annuitant at the timeof the initial solicitation of the contribution, and updated information shallbe made available at the time of execution of the annuity agreement.

(d)        The Department mayenforce performance of the requirements of this section by notifying theorganization or institution and demanding that it comply with the requirementsof this section.  The Department may fine an organization or educationalinstitution, up to $1,000 per annuity agreement, for failure to comply afternotice and demand from the Commissioner.

(e)        A charitable giftannuity issued by a charitable organization or educational institution prior toOctober 30, 1998 does not constitute engaging in the business of insurance.

(f)         For purposes ofthis section, an "educational institution" means a public or privatecollege, university, or community college that maintains a faculty to provideinstruction to students.  (1998‑211, s. 1(b).)


State Codes and Statutes

State Codes and Statutes

Statutes > North-carolina > Chapter_58 > GS_58-3-6

§58‑3‑6.  Charitable gift annuities.

(a)        A charitableorganization as described in section 501(c)(3) or section 170(c) of theInternal Revenue Code or an educational institution may receive a transfer ofproperty from a donor in exchange for an annuity payable over one or two lives,under which the actuarial value of the annuity is less than the value of theproperty transferred and the difference in value constitutes a charitablededuction for federal tax purposes.  The issuance of the annuity by a charitableorganization does not constitute engaging in the business of insurance if theorganization, when the annuity agreement is issued:

(1)        Has a minimum of$100,000 in unrestricted cash, cash equivalents, or publicly‑tradedsecurities, exclusive of the assets contributed by the donor in return for theannuity agreement;

(2)        Has been in active,continuous operation for at least three years or is a successor to or affiliateof a charitable organization that has been in active operation for at leastthree years; and

(3)        Includes thefollowing disclosure clause in each annuity agreement issued on or afterNovember 1, 1998: "This annuity is not issued by an insurance company, isnot subject to regulation by the State of North Carolina, and is not protectedor otherwise guaranteed by any government agency or insurance guarantyfund."

Subdivisions (1) and (2) ofthis subsection do not apply to an educational institution that was issuingannuity agreements prior to October 30, 1998 nor to an organization formedsolely to support an educational institution in active operation at least threeyears prior to October 30, 1998.

(b)        A charitableorganization or educational institution that issues a charitable annuity shallnotify the Department by January 1, 1999, or within 90 days of issuing itsfirst annuity, whichever is later.  The notice shall be signed by an officer ordirector of the organization or educational institution, identify theorganization or institution, and certify that the organization or institutionis a charitable organization or educational institution and that its annuitiesare issued in compliance with the applicable provisions of subsection (a) ofthis section.

(c)        A charitableorganization that issues charitable annuities must make available to the Commissioner,upon request, a copy of its Internal Revenue Service Form 990 or Form 990‑EZfor the most recent fiscal year for which the due date has passed.  If theorganization was not required to file either form with the Internal RevenueService for the preceding fiscal year, or was allowed to submit the form inabbreviated format, it shall make available to the Commissioner, upon request,the same information that would have been required to have been filed under theForm 990, in a similar format as specified by the Commissioner.  A copy of theForm 990, or corresponding substitute information as authorized by theCommissioner, shall be made available to the prospective annuitant at the timeof the initial solicitation of the contribution, and updated information shallbe made available at the time of execution of the annuity agreement.

(d)        The Department mayenforce performance of the requirements of this section by notifying theorganization or institution and demanding that it comply with the requirementsof this section.  The Department may fine an organization or educationalinstitution, up to $1,000 per annuity agreement, for failure to comply afternotice and demand from the Commissioner.

(e)        A charitable giftannuity issued by a charitable organization or educational institution prior toOctober 30, 1998 does not constitute engaging in the business of insurance.

(f)         For purposes ofthis section, an "educational institution" means a public or privatecollege, university, or community college that maintains a faculty to provideinstruction to students.  (1998‑211, s. 1(b).)