CHARITABLE GIFT ANNUITIES
A solution to your cash flow needs now and into the future.
Depending on your age, you are eligible for payments from a Charitable Gift Annuity each year for life. And you can qualify for an immediate tax deduction when you establish the annuity and have a partial tax deduction on annuity payments for years to come.
Charitable gift annuities are an extremely flexible way to make a gift. They can be designed to provide a fixed income for life for you and your spouse and/or others you choose. They are simple to create and can be funded with gifts of relatively modest amounts.
When property such as stock, mutual funds, or other securities that have increased in value is given for a gift annuity, part of the capital gains tax that would normally be due on its sale can be avoided at the time of the gift, and a portion of the gain can be reported over the annuitant’s life expectancy. The charitable deduction is typically based on the current value of the property, not its lower original cost.
Example:
Maria, 75, decides to give $10,000 for a gift annuity agreement. The payment rate at her age is 7.1%. She will thus receive a payment each year of $710 for life and a tax deduction of over $4,000 for the year of her gift.
In addition to the income tax deduction, over two-thirds of each annual payment will be received free of tax for the first 12 years of her payments.
If Maria had wished, she could have named her brother or another loved one to continue to receive annual payments for his lifetime in the event of her death. The payment rate and tax benefits in such a case would be somewhat less since the payments would be made for two persons’ lives. |
|
Amount transferred to charity |
... $10,000 |
|
Rate of payment to Maria |
... 7.1% |
|
Annual payment to Maria for life |
... $710 |
|
Immediate income tax charitable deduction |
... $4,154.70 |
|
|
For more information or to purchase a gift annuity, contact the Foundation for the Diocese of El Paso at 872-8412. Ask to speak with the Catholic Legacy Fund staff representative to set up an appointment.
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