This plan is based on the Internal Revenue Code, Treasury Regulations, Revenue Rulings, Tax Court and Supreme Court opinions that have been in existence for over a decade. The CHIRA® program also relies upon a recently issued private letter ruling by the U.S. Department of Treasury stating that the transaction does not violate tax rules prohibiting certain transactions between plans and certain parties and rules prohibiting investments in insurance. Private letter rulings are addressed only to the parties requesting the ruling, and such rulings may not be used by others as binding precedent. Nevertheless, a private letter ruling may be cited by another taxpayer as “substantial authority” for a tax position.

The PPA allows individuals, age 70½ or older, to transfer IRA cash to charity without any income tax or deduction. The funds transferred under PPA are forever lost to heirs. With CHIRA®, the funds are preserved for heirs. Charities can incorporate PPA gifts with CHIRA® plans to satisfy interest payments and/or premium payments.

The charity is the owner and beneficiary of the insurance policy. The charity pays for the premium.