The charitable gift annuity is a plan which is quite popular and which is chosen by many of our constituents who desire to have a fixed income stream along with certain tax benefits. Income payment rates are based upon age and life expectancy.
There are two types of charitable gift annuities, the current income gift annuity and the deferred income gift annuity. Both types involve the purchase of an annuity with a certain sum (minimum $5,000), a contract with the Florida conference association, and a gift of the remainder to the conference, local church, church school or other project approved by the conference.
The current income charitable gift annuity provides an income stream to the annuitant(s) beginning with the first quarter after the instrument is funded. If the annuity is for one life the income stream is discontinued upon the death of the annuitant. If the annuity is for two lives the income stream continues until the death of the last annuitant. Generally speaking senior persons choose to purchase a current income charitable gift annuity with its favorable payment rates.
The deferred income charitable gift annuity provides an income stream to the annuitant(s) beginning with the date of deferral. If the annuity is for one life the income stream is discontinued upon the death of the annuitant. If the annuity is for two lives the income stream continues until the death of the last annuitant. Because income is deferred until a later date, interest compounds over the set period of time and when income payments begin they are made at a very attractive rate. Younger persons may find a deferred charitable gift annuity to be an important instrument for the provision of supplemental income for retirement.
Both the current income and the deferred income charitable gift annuities offer major tax benefits for the annuitant(s). Please consult with one of our trust officers for information regarding the tax benefits available.
Trust officers in the department of Planned Giving and Trust Services are available to provide illustrations for charitable gift annuities for our members without obligation on their part. Please contact us for an appointment.