Gift Annuities

Charitable Gift Annuities:

A Charitable Gift Annuity is likely the most popular life income gift at colleges and universities. In exchange for your gift, UAlbany will pay you and/or another income beneficiary a fixed income for life. The annuity rate is based on the age(s) of the income beneficiaries. Among the advantages of Gift Annuities is that a portion of the income may be tax-free for a number of years and, if the gift is made with appreciated stock, the capital gains will be reduced.

The proceeds of the Gift Annuity are eventually used by UAlbany for its educational purposes or for the specific purpose designated by the donor. Gift Annuities are backed by a segregated reserve fund and also by the total assets of the UAlbany Foundation. The minimum amount required for a Gift Annuity is $10,000; minimum age is 60.

Example: Mrs. Brown funds a Gift Annuity with $10,000 and based on her age, 70, she would receive a 5.1% rate and a tax deduction of $3,469. Of her $510 income, $410 would be tax-free for the first 16 years, after which it becomes ordinary income as is the remaining $100. (Example rates and deduction as of 7/1/12)

Some Sample Gift Annuity Rates: one-life and two-lives (effective 7/1/12)

Age
Rate
Ages
Rate
65
4.7%
65/68
4.3%
70
5.1%
70/73
4.7%
75
5.8%
75/78
5.2%
80
6.8%
80/83
6.0%

 

Deferred Gift Annuities:

With a Deferred Gift Annuity, you make the gift but choose to delay receiving income payments until a future date. Because the payments are not made immediately, the annuity rate will be higher as will the tax deduction. A portion of the income will be tax-free for a number of years and, if the gift is made with appreciated stock, the capital gains will be reduced. Deferred Gift Annuities can be useful in retirement planning.

The proceeds of the Deferred Gift Annuity are eventually used by UAlbany for its educational purposes or for the specific purpose designated by the donor. Deferred Gift Annuities are backed by a segregated reserve fund and also by the total assets of the UAlbany Foundation. The minimum amount required for a Deferred Gift Annuity is $5,000; minimum age is 40 with payments beginning at age 60.

Example: Mr. Jones, age 50, funds a Deferred Gift Annuity with $10,000 and delays receiving payments until age 65. Because of the delay, he would receive a 7.5% rate and a tax deduction of $1,397. Of his $750 income, $432 would be tax-free for the first 20 years, after which it becomes ordinary income as is the remaining $318. (Example rates and deduction as of 7/1/12)

If you would like a personal illustration of a Gift Annuity or Deferred Gift Annuity, please contact the Office of Gift Planning at (888) 226-5600 toll-free or e-mail: lmatt-murphy@albany.edu.

Information provided is not intended to be estate, tax or financial advice. We recommend that you seek professional counsel on such issues from your attorney, accountant, or other financial advisor.
Investing in students - Lawrence and Marie Shore Life Sciences Graduate Student Scholarship

Lawrence and Marie Shore Life Sciences Graduate Student Scholarship:
2011-12 Shore Scholars, Erica Hutchins and Kevin Liu explore Life Sciences with Biological Sciences Professor Ben Szaro.