CHARITABLE GIFT ANNUITIES
Here’s how it works: The VCF and the donor enter into a contract providing a guaranteed fixed dollar return for life to the donor and/or other beneficiaries, in exchange for a contribution to the VCF. This contribution is invested in the VCF's investment pool. The amount of the annual payment is dependent upon the age of the beneficiary and the size of the gift. At the end of the donor’s life, the remaining assets in the CGA are transferred to a new or existing VCF fund designated by the donor during his/her lifetime. A portion of the income from the fund will be made available for grants annually in perpetuity, in accordance with the fund’s purpose statement.
Sample application form for establishing a CGA.
CGA GUIDELINES
The VCF offers three options to those who wish to purchase a charitable gift annuity:
- A current gift annuity, in which payments begin immediately.
- A deferred payment gift annuity, in which payments begin at a future date.
- A flexible gift annuity, in which the donor selects later when payments begin from a specified range of possible starting dates.
The VCF offers annuitants payout rates up to the maximum rates suggested by the American Council on Gift Annuities. Rates vary from 5.6% to 11.3%, depending on the age of the annuitant. Annuities can be issued for one or two lives. A schedule of rates is available below or can be viewed at www.acga-web.org.
The VCF issues current annuities only to annuitants over the age of 60. Younger annuitants will be offered deferred payment annuities with payments scheduled to begin no sooner than after the youngest beneficiary has reached the age of 60.
Annuities of $25,000 or larger qualify for quarterly payments, which are distributed at the end of February, May, August and November. Smaller annuities qualify for annual payments that will be made on the last day of August. The minimum gift to establish a VCF gift annuity is $15,000.
A VCF gift annuity is a contract between the donor and The Vermont Community Foundation, and is backed by the assets and good faith of The VCF. As an additional safeguard for annuitants, The VCF's policy is to invest the full amount of the original gift until the death of the annuitant, at which time the remainder will be transferred to a new or existing VCF fund as designated by the donor.
The VCF makes the process of purchasing a gift annuity as simple as possible. Donors complete a one-page application form that is returned along with the gift. The VCF issues the gift annuity contract and provides donors with the information they will need to treat their gift and their annuity income properly on their income tax return.
As a service to other charities in Vermont, the VCF will issue gift annuities that eventually form the basis of designated funds at VCF for the benefit of these other organizations.
Please contact us for further information, brochures, or application forms.
One Life Rates Since July 1, 2003
| Age | Rate | Age | Rate | Age | Rate | Age | Rate |
|---|---|---|---|---|---|---|---|
| 60 | 5.7% | 68 | 6.3% | 76 | 7.2% | 84 | 9.2% |
| 61 | 5.8% | 69 | 6.4% | 77 | 7.4% | 85 | 9.5% |
| 62 | 5.9% | 70 | 6.5% | 78 | 7.6% | 86 | 9.9% |
| 63 | 5.9% | 71 | 6.6% | 79 | 7.8% | 87 | 10.2% |
| 64 | 6.0% | 72 | 6.7% | 80 | 8.0% | 88 | 10.6% |
| 65 | 6.0% | 73 | 6.8% | 81 | 8.3% | 89 | 11.0% |
| 66 | 6.1% | 74 | 6.9% | 82 | 8.5% | 90 | 11.3% |
| 67 | 6.2% | 75 | 7.1% | 83 | 8.8% | 90+ | 11.3% |
Notes:
- These rates are for ages to the nearest birthday.
- For immediate gift annuities, these rates will result in a charitable deduction of more than 10% if the CMFR is 4.0% or higher, whatever the payment frequency. If the CMFR falls below 4.0%, rates at certain young ages may have to be reduced to meet the 10% deduction requirement.
- Rates subject to change at any time.
Two Life Rates Since July 1, 2003
| Ages | Rate | Ages | Rate | Ages | Rate | Ages | Rate |
|---|---|---|---|---|---|---|---|
| 65/65 | 5.6% | 75/75 | 6.3% | 80/70 | 6.2% | 90/90 | 9.3% |
| 65/60 | 5.5% | 75/70 | 6.1% | 85/85 | 7.9% | 90/85 | 8.4% |
| 70/70 | 5.9% | 75/65 | 5.8% | 85/80 | 7.3% | 90/80 | 7.6% |
| 70/65 | 5.7% | 80/80 | 6.9% | 85/75 | 6.7% | 90/75 | 6.9% |
| 70/60 | 5.5% | 80/75 | 6.6% | 85/70 | 6.3% | 95/95 | 11.1% |
Notes:
- These rates are for ages to the nearest birthday.
- For immediate gift annuities, these rates will result in a charitable deduction of more than 10% if the CMFR is 4.0% or higher, whatever the payment frequency. If the CMFR falls below 4.0%, rates at certain young ages may have to be reduced to meet the 10% deduction requirement.
- Rates subject to change at any time.
For more information contact:
Thomas W. Smith, CFP®
Senior Philanthropic Advisor
tsmith@vermontcf.org
802-388-3355 ext. 239
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