Charitable gift annuities have been around for more than a century and are quite simple to set up. You make a gift of cash or marketable property to Saint Mary's. Saint Mary's then reinvests the assets and guarantees you a fixed income for life. You may also structure the gift annuity to provide an income for another beneficiary's lifetime. Upon the death of the last beneficiary, the funds revert to Saint Mary's.
The transaction is part charitable gift and part purchase of an annuity. The annuity rate is the dollar amount returned to you annually as a percentage of the value of your gift and is based on the ages of the recipients. The contract specifies the frequency of payments, typically quarterly, and the date of the first payment.
A charitable gift annuity through Saint Mary's Foundation offers you a number of benefits:
- You will receive a lifetime income for yourself and perhaps one other person.
- The yield on a gift annuity may exceed your current income.
- You may receive a charitable deduction. The portion of the transaction that is considered a gift, usually between 40% and 50%, can be counted as a charitable contribution on your federal income tax return.
- You may enjoy significant savings on future taxes. Part of your annuity income, in some cases more than 30%, is considered tax-free return of capital, excluding it from gross income for several years.
- You may save on estate taxes. If you or your spouse are the only beneficiaries, the value of the annuity may not be taxed as part of your estates, instead qualifying as a marital deduction.
We can help you evaluate your options and can provide a personal proposal illustrating the benefits of a gift annuity based on your goals and assumptions. Discuss donating life income with a member of our staff now. You can contact us by email at paul.laxalt@chw.edu, by fax at (775) 770-3545 or by telephone at (775) 770-3519.
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 his or her gift. The Nevada Insurance Guaranty Association does not back up payment of annuities.
