Planned Giving
Charitable Gift Annuities
Joyce
and Burton had been married for forty-seven years. Not long
before he died, they looked into converting some of their
certificates of deposit into a charitable gift annuity. They
met with their advisors and found out it was a wonderful idea.
Joyce: We met with our tax advisor and looked at the idea. When
I saw the income we would have for the rest of both of our
lives and compared to what we were receiving from our CD's,
I was amazed! Plus there were tax benefits that helped us
immediately. And now, I don't have to do a thing - it's all
taken care of.
The
development officer explained how they could use our support
and what it meant to them. It was something Burton and I did
together, and I'm happy; really happy we did it when we
could do it together!"
A charitable
gift annuity can provide tax benefits now and a lifetime
income for the donor and a beneficiary if desired. Perhaps
also it brought peace of mind to Burton knowing that Joyce
would have the resources she needed if he was no longer there.
A deferred
gift annuity is a variation on a gift annuity. A gift
is made and the charitable organization promises in return
to pay you an income stream that begins on a future date you
specify. Since the payments do not begin for a period of time,
the fund will grow without withdrawals until the payments
begin. With more money in the fund once payments begin, the
payments will be larger than with a comparably-sized immediate
annuity.
A flexible deferred gift annuity allows you to pick a range of dates when the annuity payments will begin. For example, you might choose to begin quarterly payments on March 31st of any year not earlier than 2013 or later than 2018. The payment amount will be based on the year you choose in the future to have payments begin. The charitable gift deduction is based on the earliest possible beginning date (2013 in this case) and is taken in the year of the gift, subject to your tax circumstances.
 An
attractive benefit of this arrangement is that it enables
a donor to make a gift now and take a charitable income tax
deduction now while in a high tax bracket. Income may be deferred,
for instance, until after retirement, when the rate of tax
will presumably be lower. Deferred gift annuities are creative
ways to delay income to pay for children's or grandchildren's
college expenses, supplement your retirement income, or assist
with assisted-care living arrangements that may be inevitable.
A part
of each payment, as in any gift annuity, may be tax-free for
a period of years. However, the precise amount of each payment
will depend on the tax rules in effect when the payments start.
Charitable
gift annuities are the gifts that keep on giving. Rates on
charitable gift annuities are based on age and whether the
contract is immediate or deferred. If you would like an illustration
of this life income to address your particular situation,
please click here and fill out the
response form and send us the appropriate information. To
look at some specific rates on current gift annuities, click
here. A generic
example of a charitable gift annuity is available as well
as a graphic
example.
Now click here to meet Susan and Fred. |
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