Charitable Gift Annuity

One of the reasons gift annuities are so popular is that they offer donors payments that are fixed and are backed by the general resources of the issuing institution.  The resulting predictability and security of annuity payments has strong appeal for a broad range of planned gift donors.  The age of the donors has a lot to do with this appeal.

This article covers the idea of creating a gift annuity with the remainder value of a retained life estate. A donor may to do this if he/she needs extra income while in his/her home.

PG Calc presents an excerpt from its white paper, State Gift Annuity Registration: A Primer on What It Means to Your Organization. If you have thoughts on this paper or recommendations for a white paper topic, please send them to info@pgcalc.com.

View all of our white papers, or our newest complement download: 7 Characteristics of Successful Planned Giving Programs.

For gift planning offices at most not-for-profit organizations (NFPs), FASB accounting is the last thing on the list. Activities are geared towards bringing in new planned gifts, ongoing administration, and donor stewardship. The financial office asks for a FASB liability report once a year (at a few NFPs, once a quarter). Someone in the gift planning office runs off a new report using similar assumptions to the previous year. If there is an outside gift administrator, they can be asked to produce the report.

When it comes to state regulation of gift annuities, the specific requirements of the most regulated states garner the most attention. But there are only 10 of those states. A charity can satisfy the regulatory requirements of the 40 other states with relative ease and speed. Working from the least regulated to the most regulated, the states can be broken down as follows: