Charitable Gift Annuity Rates Beat CD Rates and are Good for Life!

Yvonne M. Long and Foundation Executive Director Charley Strickland stroll along the meditation walk by St. Tammany’s memorial fountain.

Charitable gift annuities are "win-win" gifts for both the donor and the nonprofit. The donor benefits by giving a gift that provides income for life. In addition, a large portion of the annuity is tax-deductible and the benefit can be spread over five additional years. Moreover, a portion of the annual payment is tax-free. The nonprofit also benefits by receiving a gift today that may be larger than an anticipated bequest in the future.

The rate is based on the donor's age at the time of the gift. For example, a donor aged 75 who gives a gift of $20,000 will receive an annual payment of $1,420 or 7.1% for life. The charitable tax deduction is $8,865 spread over this year and five additional years if necessary. The tax-free portion of the $1,420 payment is $897 for 12.4 years. The minimum donation is $10,000 and the rates are capped at age 90 at 11.3%.

Yvonne M. Long is a recent charitable gift annuity donor to the St. Tammany Hospital Foundation and is familiar with charitable gift annuities as she has two with other favorite charities. A native of Kent, England, Mrs. Long met her husband, Jay, an LSU engineering graduate about 40 years ago in Jackson Square when she was a tourist in New Orleans. He stopped to assist her by giving her directions.

Mr. Long passed away several years ago with complications from rheumatoid arthritis. Mrs. Long was concerned that his last days were very difficult and thought they may have been more positive with the assistance of hospice care.

Her charitable gift annuity is restricted for use by Hospice of St. Tammany Parish Hospital upon her death. "I am pleased to be able to do a bit of good and receive an income for life as well," Mrs. Long said.