Charitable Gift Annuities

Immediate Payment and Deferred Payment

The gift annuity offers you the assurance of payments that will not fluctuate. Moorestown Friends School has a Charitable Gift Annuity program in partnership with Friends Fiduciary Corporation, a Quaker non-profit corporation which supplies financial services to Quaker institutions.

A charitable gift annuity offers you three distinct tax benefits:

1. You will receive an income-tax charitable deduction for your gift annuity, based on the full value of the assets you contribute minus the present value of the life-income interest you retain (see the example below for more details).
2. If you fund your charitable gift annuity with appreciated securities, no upfront capital gains tax is payable. Only a portion of your capital gain will be reportable, and the tax will be spread over your annuity payments.
3. Part of each annuity payment will be considered the tax-free return of your principal. This effectively increases the cash flow from your gift annuity, and is not available with other types of life-income gifts.

(The IRS provides that the capital gain and tax-free-payment benefits are in effect during your life expectancy - if you live beyond your life expectancy, the entire annuity payment will be taxed as ordinary income.)

Your gift annuity can start paying you once you make your contribution (an immediate-payment gift annuity), or payments can commence at a later date selected by you (a deferred gift annuity). Deferral allows us to offer you a higher annuity rate and gives you a larger charitable deduction.

Many younger donors create a series of deferred gift annuities over multiple years, jointly timed to begin making payments when they retire. To fund their gifts, they use assets they've already designated for retirement savings. Their deferred gift annuities give them an income tax deduction when they most need it, and an additional source of cash during their retirement years.

More

• Is this gift for you? Click here.
• Picture this gift. Click here.

To learn more about charitable gift annuities, Email us, complete the Information Request Form, or call us at (856) 235-2900 so that we can assist you.