EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted. Green numbers along left margin indicate location on the printed bill (e.g., 5-15 indicates page 5, line 15).

1-1 Section 1. Chapter 688A of NRS is hereby amended by adding

1-2 thereto the provisions set forth as sections 2 to 6, inclusive, of this act.

1-3 Sec. 2. As used in sections 2 to 6, inclusive, of this act, unless the

1-4 context otherwise requires:

1-5 1. "Charitable-gift annuity" means an annuity payable over one or

1-6 two lives issued by a charitable organization in return for a transfer of

1-7 money or property by the donor, if the actuarial value of the annuity is

2-1 less than the value of the money or property transferred and the

2-2 difference in value is deductible as a charitable contribution for purposes

2-3 of federal taxes.

2-4 2. "Charitable organization" means an artificial person described as

2-5 such in Section 501(c)(3) of the Internal Revenue Code of 1986, 26

2-6 U.S.C. § 501(c)(3), or Section 170(c) of the Internal Revenue Code of

2-7 1986, 26 U.S.C. § 170(c).

2-8 3. "Qualified charitable-gift annuity" means a charitable-gift

2-9 annuity described in Section 501(m)(5) of the Internal Revenue Code of

2-10 1986, 26 U.S.C. § 501(m)(5), and Section 514(c)(5) of the Internal

2-11 Revenue Code of 1986, 26 U.S.C. § 514(c)(5), which is issued by a

2-12 charitable organization that on the date of issuance:

2-13 (a) Owns at least $300,000 worth of money, cash equivalents or

2-14 publicly traded securities, exclusive of the amount transferred to it in

2-15 return for the annuity; and

2-16 (b) Has operated continuously for at least 3 years or is a successor or

2-17 affiliate of a charitable organization that has operated continuously for

2-18 at least 3 years.

2-19 Sec. 3. The issuance of a qualified charitable-gift annuity does not

2-20 constitute transacting insurance in this state. A charitable-gift annuity

2-21 issued before October 1, 1999, is a qualified charitable-gift annuity for

2-22 the purposes of sections 2 to 6, inclusive, of this act.

2-23 Sec. 4. In an agreement to issue a qualified charitable-gift annuity,

2-24 the charitable organization shall disclose in writing to the donor that the

2-25 annuity is not insurance under the laws of this state, is not subject to

2-26 regulation by the commissioner and is not protected by an insurance

2-27 guaranty association. The disclosure must be made in a separate

2-28 paragraph and may not be in a size of type smaller than used generally in

2-29 the agreement.

2-30 Sec. 5. 1. A charitable organization that issues qualified

2-31 charitable-gift annuities shall notify the commissioner in writing on or

2-32 before December 30, 1999, or the expiration of 90 days after it first

2-33 enters into an agreement to issue a qualified charitable-gift annuity,

2-34 whichever is later. The notice must:

2-35 (a) Be signed by an officer or director of the organization;

2-36 (b) Identify the organization; and

2-37 (c) Certify that the organization is a charitable organization and that

2-38 the annuities are qualified charitable-gift annuities.

2-39 2. Unless the commissioner demands information to determine the

2-40 amount of a penalty under section 6 of this act, the organization need

2-41 submit no other information.

3-1 Sec. 6. 1. Failure of a charitable organization to comply with the

3-2 requirements of section 4 or 5 of this act for disclosure or notice, or both,

3-3 does not disqualify an annuity that otherwise constitutes a qualified

3-4 charitable-gift annuity.

3-5 2. The commissioner may demand, by certified mail with return

3-6 receipt requested, that the organization comply with those requirements,

3-7 and may impose a fine of not more than $1,000 for each charitable-gift

3-8 annuity issued before compliance is complete.