The suggested maximum payout rates for Charitable Gift Annuities (CGAs) are decided by the American Council on Gift Annuities (ACGA). On April 15th, the ACGA voted to make no changes to the immediate and deferred gift annuity rates currently in effect. This means that the rates published on January 1st, 2012 are still applicable.
The rates for a single beneficiary are as follows:
You can view the rates for a two-life annuity here.
What does this mean?
Let’s take a look at an example.
A single man, age 65, would like to make a donation to a Covenant ministry. He agrees to a Charitable Gift Annuity in which he donates $10,000 and names himself the beneficiary of the payouts. The donation is invested, and every year, a portion of this money is paid out to the donor.
According to ACGA’s suggested rates, the payout for one person age 65 is 4.7% of the donation; this payout rate is fixed and does not change. This means that every year for the rest of his life, the beneficiary in this example will receive a payout of $470 through the Charitable Gift Annuity ($10,000 x 0.047).
When the beneficiary passes, the remaining funds are distributed to the ministry.
Charitable Gift Annuities
In addition to receiving a lifetime stream of income, there are certain tax benefits for donors. Most importantly, CGAs provide an opportunity for people to make significant donations to their favorite charities. You can read more about Charitable Gift Annuities on our blog, or you can request more information here. As always, if you have any questions, feel free to contact us or leave a message below.
Rates Effective January 1, 2012 To Remain the Same – American Council on Gift Annuities