A Charitable Gift Annuity is a simple contract whereby you make an irrevocable gift (typically cash or securities) in exchange for a fixed-sum guaranteed annual payment for life. At the time the last named annuitant dies, Young Life will receive the remainder of the funds used to create the annuity and will use them in the manner directed by you.
- Who should consider a Gift Annuity?
Gift Annuities are most appropriate for people who want a secure, continuous stream of income for the rest of their lives and who desire to continue to support Young Life after their passing. Gift Annuities are great for those who wish to support Young Life at the end of their lives but may be interested in having additional income and tax advantages now.
- What types of Gift Annuities are there?
The Young Life Gift Annuity Program offers three choices for Gift Annuities:
- Single-Life: Lifetime income goes to one person.
- Two-Life: Lifetime income lasts for the lifetimes of two individuals.
- Deferred: You create the annuity but do not receive payments until a later date. This can be ideal for individuals under 60 who want to supplement their income in the future.
- How is my payout rate determined?
The payout rate is calculated based on your age at the time you establish the Gift Annuity and is fixed for the life of the annuity. The older you are, the higher the rate. (See the chart below for more details.) We are happy to provide you with a personalized illustration of how a Gift Annuity may benefit you. Please inquire about the rates for a two-life or deferred annuity.
- Will I get a tax deduction for this gift?
You will receive a tax deduction for the portion of the gift that is determined to be charitable. This deduction may be claimed in the year the gift is made and carried over for up to five subsequent years. We are happy to provide you with an illustration demonstrating what this may look like for your particular gift.
- Will the income I receive be taxable?
Much of the payout may be taxed as ordinary income. However, some of the income may be tax-free, thereby increasing the net income you receive.
- Is there a minimum amount I can use to start an annuity?
Yes. The minimum amount that we can accept to fund an annuity is $10,000.
- How can I fund a Gift Annuity?
Gift Annuities are typically funded with cash or marketable securities. By using a highly appreciated security to fund your gift, your capital gains tax burden may be reduced because you will not be taxed on the portion of gain that is determined to be a charitable gift.
- Can I add more to the Gift Annuity at a later date?
Because the payout rate is based on your age at the time the annuity is created, you cannot add additional gifts to the annuity at a later date. However, you can create a new Gift Annuity at any time.
- Can I have input on how my gift will be used?
Yes. When setting up a Gift Annuity to benefit Young Life, you will be able to advise us as to the Young Life ministry you want to support.
- How are the Gift Annuity funds managed?
All of the funds placed into the Young Life Gift Annuity Program are professionally managed through Young Life's partnership with the National Christian Charitable Foundation (NCCF) in Atlanta, Ga. They handle all legal and managerial functions surrounding the issuance of Gift Annuities to benefit Young Life.
Example
John and Mary Smith have supported their local Young Life area for years. They wanted to make a substantial gift to support their local area but weren't sure how to do it. In their search for answers, they contacted the Young Life Gift Planning department and asked for information about the different types of plans available, specifically the kinds of gifts that can provide them with a lifetime income and will support the ministry of Young Life after they have passed away.
After careful review of the gift planning options available and after seeking the counsel of their professional advisors, John and Mary decided to create a Charitable Gift Annuity through the Young Life Annuity Program. Here is how it works:
|
Gift Amount |
$10,000 of stock that originally cost them $2,500 |
|
John's Age |
75 |
|
Mary's Age |
71 |
|
Payout Rate |
7.1% |
(based on their ages at the time of the creation of the annuity)
This annuity will pay John and Mary $710 a year for the rest of their lives. They will receive an immediate charitable tax deduction of approximately $3,800. Also, they will partially bypass the capital gains tax on the stock used to fund the gift annuity, which will save them approximately $580. Over their annual remaining life expectancy, John and Mary will receive approximately $12,900 in income from this gift. When they pass away, they will leave behind approximately $10,000 for Young Life's work with kids in their community.
A Gift Annuity is an excellent way to provide extra income for retirement and leave behind a substantial gift to support the work of Young Life with the kids of tomorrow.
Upon request, Young Life will provide a detailed Charitable Gift Annuity Brochure and a personalized Gift Annuity analysis.
To receive additional information, complete the confidential online
Gift Planning Information Request Form.
For all questions on how to set up credit card gifts, electronic fund transfers, a lost receipt or any
other general giving questions, call Young Life Mission Assistance at (877) 438-9572.
For more information on setting up a planned gift to benefit Young Life, please contact:
Jeff Rudder
Director of Donor Services
Young Life Foundation
P.O. Box 520
Colorado Springs, CO 80901-0520
Phone: (800) 813-1945
Fax: (719) 381-1755
E-mail: inquiries@foundation.younglife.org
*The information contained herein is for explanatory purposes only and is not intended to be used as tax advice. Young Life recommends that you contact a professional tax advisor who can provide you with additional information on how your participation in the above program may affect your personal tax situation.