Charitable Gift Annuity How it works You transfer cash, securities, or other property to benefit UGA. You receive an income tax deduction and may save capital gains tax. A fixed amount will be paid each year to you or to anyone you name for life. Typically, a portion of these payments is tax-free. When the gift annuity ends, its remaining principal passes to benefit UGA. A Charitable Gift Annuity is a simple agreement. In exchange for your gift of cash, securities, or certain types of other assets (possibly real estate or timber rights), you and/or another beneficiary will receive fixed, periodic payments for life. A portion of the payment to you may be tax-free, or taxed at the more favorable rate for taxes on capital gains. You will be entitled to an immediate federal income tax deduction for a portion of your gift. The amount of the deduction will be based upon the amount of the gift, your age and/or another beneficiary, and the annuity payment rate. The amount of the payment from the Charitable Gift Annuity is guaranteed for life and will be backed by the assets of the issuing charity. Example: Ms. Johnson, age 89, has stock that she purchased many years ago. The stock, for which she paid $100,000, is now worth $350,000. She decides to establish a Charitable Gift Annuity to benefit UGA with a gift of the stock. She wants to receive the annuity payments for her life and then have the payments go to her brother (age 81) for his life. The terms of the Charitable Gift Annuity provide for an annual payment of $30,000 for both lives. Ms. Johnson will receive a federal income tax deduction of approximately $155,442. Her income tax deduction for this will be limited to 30% of her AGI. However, she will be able to take the unused deductions over the next five years, subject to the same 30% limitation. There will be no taxes on capital gains at the time of the gift and she will be able to spread her taxes on capital gains over several years. She also takes the majority of the gift out of her estate. Types of Giving | Featured Donors | Professional Advisory Reference | Heritage Society | Get In Touch! | Home