Charitable Gift Annuity—Immediate Payment

Overview

To establish a charitable gift annuity, a donor makes a gift to UJA-Federation and in exchange receives a fixed annual dollar amount for life. The principal remaining at death will then benefit UJA-Federation.

65 and Older and Want Income for Life? This Is the Gift.

While gift annuities can be funded at a younger age, this type of gift might be especially attractive if the donor is aged 65 or above, wants to support UJA-Federation, and would like to secure an immediate stream of income for the donor or the donor and the donor's spouse. The amount of the payments is based on the age(s) of the beneficiary(ies). The older one is, the higher the payout rate one receives. In addition to the stream of fixed payments, the gift will also generate an immediate charitable income-tax deduction.

Gift Range: $10,000 and more

Example: Anne, aged 78, gives $25,000 in cash to UJA-Federation in exchange for a gift annuity. She receives an income-tax deduction of approximately $11,273, based on her age. She will begin receiving income checks of $1,900 each year for the rest of her life. When she passes away, the remaining principal will benefit UJA-Federation.

Want to see a diagram about how a gift annuity works? View the diagram of this gift

Tip: Give Appreciated Securities and Avoid Capital-Gain Tax

The charitable gift annuity is especially rewarding if funded with appreciated long-term securities generating little or no income. If the donor transfers such securities to UJA-Federation in exchange for a charitable gift annuity, the donor may avoid a significant amount of capital-gain taxation and any remaining capital gain will be reported in prorated amounts over the life (or lives) of the beneficiary(ies).

Younger but Interested in Receiving Income Later?

If the donor is younger and/or wishes to begin receiving payments at a future date, a deferred-payment gift annuity might be a more suitable gift arrangement.

Want to see a diagram about how a deferred-payment gift annuity works? View the diagram of this gift

*The information contained herein is offered for general informational and educational purposes. The figures cited are accurate at the time of writing. State law may affect the results illustrated. This is not legal advice. Any prospective donor should seek the advice of a qualified estate and/or tax professional to determine the consequences of their gift. California residents: Annuities are subject to regulation by the State of California. Payments under such agreements, however, are not protected or otherwise guaranteed by any government agency or the California Life and Health Insurance Guarantee Association. Oklahoma residents: A charitable gift annuity is not regulated by the Oklahoma Insurance Department and is not protected by a guaranty association affiliated with the Oklahoma Insurance Department. South Dakota residents: Charitable gift annuities are not regulated by and are not under the jurisdiction of the South Dakota Division of Insurance.

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