Charitable Gift Annuity
What is a CGA?
A gift annuity is a contract between you and a foundation, in which you make a gift of cash or securities (e.g., stocks, bonds, mutual funds) in exchange for fixed quarterly annuity payments to yourself for life. After the passing of the annuitant(s), the remainder of the gift will be used by your favorite chosen charitable gift organization(s): GPLHS, your congregation, other areas of ministry, etc.
What are the features of a CGA?
• Flexible. You can either begin receiving annuity payments right away or sometime in the future when
you will need additional income. While there is a minimum gift size of $10,000, there is no maximum
limit. You can fund a gift annuity for yourself, a loved one, a friend, or even an employee.
• Secure. Your annuity payments are backed by the assets of your chosen foundation.
• Permanent. Your annuity payment to yourself is a fixed amount - dependable and unchangeable.
• Minimum ages. Immediate payment annuities are available to those who are year 60 and older.
Deferred payment annuities are available to people who are year 45 and older.
• Irrevocable. Once established, a gift annuity cannot be changed or cancelled. You may, however,
choose to end the annuity payments to yourself and allow the residual to be paid directly to your
What are the benefits of a CGA?
• Joy. Ability to benefit the area(s) of the Lord’s work that is/are closest to your heart.
• Fixed payments for life. Your gift comes with the assurance of steady, lifelong payments to you.
• Tax savings. You receive an immediate income tax charitable deduction. In most instances, a portion
of your gift annuity payment will be a tax-free return of the original principle. If you transfer
appreciated assets for a gift annuity, you defer tax on a portion of the capital gain. If you defer
annuity payments until a future date, you also delay reporting of the capital gain.
• Lasting legacy. After the annuitant(s) goes to heaven, the balance will be used to continue the Lord’s
work at GPLHS, your congregation, other areas of ministries, etc.
One example of how this gift works
Annette gives $25,000 for a charitable gift annuity. She will receive 5.8% or $1,450 per year for the rest of her life. She will also receive a federal (and possibly a state) income tax charitable deduction of approximately $10,465 in the year of the gift, and pay income tax on only a portion of the $1,450 received each year.