The Tax-Advantaged Gift that Pays You Back
A Charitable Gift Annuity allows you to support Library Foundation SD, and also receive secure, fixed income for life.
Established through a simple agreement, a Charitable Gift Annuity can provide you with valuable income, income tax savings, and capital gains tax benefits.
Here’s how it works:
- Gift and income agreement. You make a gift of cash or appreciated assets for the benefit of the Library Foundation SD. In exchange, you will receive fixed income payments for your life and/or the life of a loved one. The annuity payment amount is fixed and will not change even with economic fluctuations.
- You may start your payments immediately or defer your annuity payments and receive a higher rate.
- The annuity rate is determined by the age(s) of the income beneficiary(ies) at the time of the gift.
- Once your charitable gift annuity is established, your rate and the amount of your income will not change.
Benefits:
- Secure, fixed lifetime payments for you and/or another beneficiary.
- Current charitable income tax deduction. Any income tax deduction that you are not able to use this year may be carried forward for up to five additional years.
- Avoid or delay capital gains taxes on appreciated assets used to fund your gift.
- Partially tax-free income throughout the expected lifetime(s) of the income beneficiary(ies).
- Satisfaction of helping to support the Library Foundation SD and the future of your library.
Sample current gift annuity rates
As of January 1, 2024
Example
- Linda, age 75, donates appreciated securities that she has owned for over one year worth $50,000, with a cost basis of $20,0000.
- Her partial bypass of a $30,000 gain may save $1,987.
- Based on her age, her rate is 6.6%, and she will receive lifetime annual payments of $3,300. Of this amount, $ 899.71 will be income tax-free throughout her expected lifetime. Her estimated total payout throughout her life is $51,480.
- She may split her income into semiannual, quarterly, or monthly payments.
- She would expect to receive a charitable income tax deduction of $20,619. If she cannot use all of it this year, she may carry forward the excess for up to five years.
- After her lifetime, approximately $25,000 will pass to the Library Foundation SD without probate fees or estate taxes.
Questions?
If you want to know more, please get in touch with Natalie Ganz, Chief Philanthropy and Engagement Officer, at (619) 238‑6643 or by email at nganz@libraryfoundationsd.org.
This information was accurate at the time of posting. This information is not legal, financial, or tax advice. Please consult a qualified professional advisor when considering your charitable giving options. Annuities are subject to regulation by the State of California. Payments are not protected or otherwise guaranteed by any government agency or the California Life and Health Insurance Guarantee Association. The example above is for illustration purposes only. It uses the applicable federal rate in effect at the time of posting, and it assumes a federal income tax rate of 24%, a California income tax rate of 11%, and a capital gain tax rate of 15%.
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