Gift Annuity Benefits

One of the simplest and most popular charitable gifts is a charitable gift annuity. This gift option is a combination of an investment and a gift and provides life income to the donor (and another recipient if desired - the annuitants). The designated charity accepts the gift and in return obligates itself to pay a fixed and specified dollar amount to the annuitant(s) for life.

A charitable gift annuity immediately becomes the property of the charity and is an irrevocable gift. The charity is legally bound to fulfill its commitment to pay the annuitant(s) for life. Some states have regulations regarding the issuance of charitable gift annuities. Please contact us regarding any questions.

There are two types of charitable gift annuities - immediate and deferred. An immediate annuity begins paying income immediately after the annuity agreement is signed. A deferred charitable gift annuity begins the income payments at a specified date in the future. A deferred charitable gift annuity will generally provide a larger charitable deduction than the immediate annuity and, as the funds will have an opportunity to grow without income distributions for a period of years, the income rate will generally be larger.

Benefits

• Since a portion of the annuity is a gift, you'll receive an income tax deduction for the gift.
• A portion of the annual annuity income is exempt from federal taxes.
• You may save tax on the capital gains (profit from an investment).
• You avoid estate taxes and probate costs.
• The organization will have immediate use of some of the funds you pay them for your annuity.
• Your annuity is as safe as the organization you invest with, for the total assets of the organization stand behind its agreement to make payments to you.

NOTE: The gift annuity is irrevocable; once you have parted with your money pursuant to the annuity contract, you cannot get it back.

Click to return to Charitable Gift Annuities or to the Glossary.

Please note, individual financial circumstances will vary. The information on this site does not constitute legal or tax advice. Donor stories and photographs are for purposes of illustration only. As with all tax and estate planning, please consult your attorney or estate specialist. All material is copyrighted and is for viewing purposes only. Use of this site signifies your agreement with the terms of use. The content in this Planned Giving section has been developed for Saint Joseph's College by Future Focus. Please report any problems to webmaster. Revised: May 22, 2008 8:48.