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Gift Annuities

Charitable Gift Annuities

A charitable gift annuity is a practical and generous way to make a meaningful charitable gift. You will receive lifetime fixed income payments and tax benefits that contribute to your future well being. A gift annuity can be an excellent means of providing for a long-term financial need of a spouse, relative or friend. The same income payment continues after the first annuitant is no longer living.

A charitable gift annuity is a simple contract. In exchange for your irrevocable gift of cash or appreciated securities, you will receive a fixed income for one or two designated annuitants for life. The payment rate is dependent upon your age(s). Older donors can find this to be a very attractive option. Income payments may be received annually, semiannually or quarterly. If preferred, the donor may delay income or take partial income and these options are called deferred and flexible charitable gift annuities.

The gift annuity matures at the death of the last surviving income beneficiary and the gift principal remaining in the contract is transferred to the Landis Homes fund designated by the donor(s).

Important Questions

What is the minimum amount required to purchase a gift annuity?

At Landis Homes a charitable gift annuity contract can be written for $10,000 or any higher amount.

Does the annuity rate change with the stock market or interest rates?

No, the payment rate is set permanently when you make the gift and will continue unchanged throughout the lifetime of the annuitant(s).

Does a charitable gift annuity offer income tax benefits?

Part of the gift value qualifies as a charitable tax deduction in the year of the gift (and up to 5 years hence.) Also, a portion of the annuity payments received each year is tax free until the annuitant(s) life expectancy is outlived. Each year beyond this time, the entire payment is reported as ordinary income.

What is the payment rate based on?

All gift annuity rates are based on the age of the annuitant(s) and are set by the American Council of Gift Annuities. A two life annuity provides for a slightly lower rate than a single life annuity. Here are sample single life gift annuity rates for an immediate payment.

Age      Rate
65        4.7%
70        5.1%
75        5.8%
80        6.8%
85        7.8%
90        9.0%

Will I avoid capital gains tax if I give appreciated property or securities to purchase a gift annuity?

The capital gains tax is avoided in part on appreciated property gift assets. Part of the gain is allocated to the charitable gift amount and there is not capital gains tax on that portion. The balance of the gain is allocated to the gift annuity and is taxed each year over the projected life expectancy of the annuitant(s).

EverenceLandis Homes Gift Annuity program is managed by Mennonite Foundation of Everence. We are also happy to work with your financial advisors to ensure that your desires and interest are met. The Landis Homes Advancement Team is  available to provide additional information at no obligation. This includes a personalized and confidential informational proposal.  Please contact the Advancement Office at (717) 509-5490.