Life Income Gifts

Because of its many benefits and the ease with which it can be established, the Charitable Gift Annuity (CGA) is the Library’s most popular life income gift option.

A Charitable Gift Annuity is a simple contract between you and the Library. In exchange for your gift of cash or securities (minimum $10,000), the Library agrees to pay you and/or a loved one or a friend a fixed annual sum for their lifetime(s). Annuity payments are guaranteed and as of February 2009 range between 4.8% and 9.5%, depending on your age(s). In most cases, part of each payment is tax-free, increasing each payment's after-tax value. If securities are used to establish a CGA, some capital gains tax will be avoided. At the time of your gift, you are entitled to a charitable income tax deduction, and at your death, the Library receives the balance of your CGA.

If you are under age 55, you may want to consider a Deferred Payment Gift Annuity. You would still qualify for a charitable income tax deduction in the year you make your gift, but by deferring the annuity payments to some future date, these payments will be greater. Many donors use deferred payment gift annuities to supplement their retirement incomes.

The Charitable Remainder Trust offers the most flexibility of all the life income gift arrangements. You transfer assets (usually cash, securities or real estate) to a trustee of your choice through a formal trust agreement. If appreciated property is donated, no capital gains tax is due on the transfer, and your income tax deduction is based on the fair market value of the donated assets. Your trustee invests the trust assets and makes annual payments to you and/or loved ones, based on the payout rate chosen by you. At your death or at the termination of the trust, the principal is distributed to the Library. You may choose a fixed rate of income (Annuity Trust) or a variable rate of income (Unitrust).

To learn more about any of the life income gifts described, please contact the Planned Giving Staff.