Essentially, annuities are insurance products designed to provide guaranteed income for life to consumers. This legally binding contract is a written agreement between an insurance company and its client. Annuities were created in a wide range of styles, designed to offer a variety of fit wide range of budgets and needs. A charitable gift annuity is just one example of many available annuity contracts. Charitable gift annuities (CGAs) allow clients to plan for charities to receive a financial gift in the future. It may sound similar to any average financial gift, but here a charity purchases the gift on behalf of donors rather than a contract existing between an insurance company and yourself. Donors receive charitable gift annuity payments during their lifetime, with the remaining annuity balance going to a charity upon death. This type of annuity serves as a generous donation, providing a partial income tax donation. Additionally, the annuitant receives a guaranteed lifetime income stream that may extend as a benefit to a spouse or chosen recipient. This method provides a practical toolkit for building and maintaining a relationship with favored charitable organizations. While many non-profit charity organizations may not accept them, a CGA may be used by other organizations that qualify as a 501c3, including educational, charitable, and religious entities. The IRS has specifically defined 501c3 organizations as educational, charitable, scientific, religious, literary, and more. Private shareholders may not serve as the primary beneficiary of a 501c3 organization. Said charities must submit an IRS form 1099R to CGA annuitants in compliance with tax law. This practice indicates that the contributions received, including property and cash, are deemed capital gains, taxable, and non-taxable.
Contact Information:
Email: [email protected]
Phone: 3037587400
Menu
Menu
