David C. Roark and Estate of Irene Roark, Deceased, David C. Roark, Executor - Page 10

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          agreements it had made, so it began sending letters to all its              
          contributors encouraging them to terminate their policies.  If a            
          contributor agreed, NCF would be able to recover the unearned               
          premiums.  But without a contributor’s agreement to terminate,              
          NCF’s investment was at risk.  If the contributor died quickly,             
          NCF would receive a great deal of money; but if he outlived the             
          time it took for the life insurance company to earn its premiums            
          on NCF’s accelerated payments, NCF would get nothing.                       
               Roark got such a letter, but he never agreed to terminate              
          the policy.  He also never contributed any more money to NCF once           
          the legislation was introduced.  But he did make another payment            
          to IDS Life in December 2001 to prevent the insurance policy from           
          lapsing.  Then, in March 2003, he reduced the policy’s death                
          benefit from $2.2 million to $1.1 million.  This guaranteed that            
          the Trust would receive at least some death benefit even if he              
          never paid another premium.                                                 
               If the payments to NCF are counted, the Roarks contributed a           
          total of $220,966 to charity during 1998.  Due to rules that set            
          an annual ceiling on charitable contribution deductions, sec.               
          170(d)(1), the Roarks deducted only $166,031 in 1998 and carried            
          over the remainder to 1999.  The IRS issued a notice of                     
          deficiency for the 1998 and 1999 tax years that disallowed the              
          $180,000 in contributions to NCF.  The Commissioner later reduced           
          the disputed amount because NCF never made a payment on the                 






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