Charitable
Gift Annuity FAQ
What is a gift
annuity?
A gift annuity is a simple
contract between an individual and a charitable
organization. The donor transfers assets
and receives fixed payments for the rest
of his or her lifetime and/or the lifetime
of another person.
Does a gift annuity
provide tax benefits?
Yes. Depending on the
situation, there can be a combination of
income, capital gain and estate tax savings.
How is the size
of the annuity payments determined?
Several factors are relevant,
including the amount placed in the annuity
and your age at the time the annuity is
created.
Why does age affect
the payment rate?
Life expectancy changes
with age and part of the amount you transfer
is returned to you over your life expectancy.
Generally, the older you are when your annuity
begins, the higher your payment.
What if I outlive
my life expectancy?
Your charitable gift annuity
agreement provides for payments as long
as the annuitant lives.
Do my payments
change each year?
No. Your rate of payment
for each specific gift annuity is set when
that annuity begins.
Are annuity payments
affected by interest rates or the economy?
No. Payments for a specific
annuity never increase or decrease, regardless
of changes in interest rates or economic
fluctuations. All net assets of Hattie Larlham
stand behind your agreement.
How can I help
another person through a gift annuity?
You can designate someone
else to receive payments with you, instead
of you, or only following your death. This
can establish two gifts—one to Hattie
Larlham and another to a relative or friend.
Can I give stocks,
bonds or securities instead of cash to fund
a gift annuity?
Yes. If you give a low-yielding
asset to fund your annuity, you may also
be able to increase your income, because
a gift annuity may pay more and be taxed
more favorably than other income. There
can be other tax benefits if the securities
have increased in value because you avoid
the tax on part of the capital gain in the
property.
Will my gift annuity
be part of my estate?
Generally, no. If payments
are made to you only, the gift portion goes
directly to the charity. This avoids estate
taxes and probate costs. Some gift or estate
tax may be due if payments are made to a
person other than a spouse.
Is there a minimum
dollar amount for a gift annuity?
Yes.
An
annuity
can
be
established
for
$10,000.
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