Want to increase income?  Supplement your retirement?  Or perhaps pay an income to someone else? 

A charitable gift annuity can help you combine financial and charitable goals.  In exchange for your irrevocable gift of $10,000 or more, The Leukemia & Lymphoma Society (LLS) will make fixed, lifetime payments to you and/or another beneficiary.  When the last beneficiary passes, the remainder is used by LLS for a purpose you can specify.

How much will I receive?
Age has its rewards.  The older the payment beneficiaries are, the higher the rate paid.  The rate is determined by the age of the beneficiaries when the annuity is funded.  It remains stable for the lifetime of the annuitants without concern for stock market fluctuations.

Some sample rates follow:

Single Beneficiary:                       Two Beneficiaries:

Age	Annuity Rate		Ages	Annuity Rate
65	5.3%		68 & 65	5.0%
70	5.7%		72 & 70	5.3%
75	6.3%		72 & 75	5.4%
80	7.1%		87& 80	6.6%

In addition to favorable rates, you will also enjoy other tax benefits including tax-free income, capital gains tax advantages and a charitable income tax deduction.

How are my annuity payments taxed?
Part of each annuity payment is considered a tax-free return of principal.  If you use cash to fund your gift annuity, a large portion of each payment will be tax free throughout your life expectancy.  Beyond your life expectancy, the payments will be treated as ordinary income.

If you use appreciated securities to fund your gift annuity, some of the tax-free portion will be considered as capital gains income because capital gain is spread over life expectancy when the owner and beneficiary are the same.  Rules differ if you create an annuity for the benefit of someone else. 

You will receive a Form 1099 each year to tell you how to report the income on your tax return.

Do I receive an income tax deduction?
Yes, you are entitled to an income tax deduction when you fund a gift annuity.  Generally, the deduction is 40-60 percent of the face value of the annuity.  The exact amount depends on several factors, including your age and the annuity rate.

When will I receive my payment?
You can choose quarterly or semi-annual payments and receive it either by check or a direct deposit to your bank account.

Why would I create a gift annuity to benefit someone else?
For some, a gift annuity can provide a solution to a special need.  For example, an adult child who provides financial support for an older parent might fund a gift annuity for the benefit of the parent(s).  In this way, the adult child receives an income tax deduction based on the older age of the parent(s).  And the parents receive a rate based on their age. 

Or a donor might use a gift annuity to provide a retirement benefit to a valued employee.  As in the example above, the donor receives a deduction based on the beneficiary's age.

Are gift annuities a good idea for everyone?
Not necessarily.  While a gift annuity provides guaranteed payments for life, if you are younger than 65, you should balance fixed income with investments that serve as a hedge against inflation.

If I am under 65, is there an annuity option for me?
Yes, it is called a deferred gift annuity.  By deferring payments to a future date, you receive a higher rate of income and a higher tax deduction and you still receive a tax deduction in the year you fund the annuity. 

A deferred gift annuity can be a good way to combine charitable giving with retirement planning, particularly for those who are unable to make more tax-free payments to retirement plans. 

As examples of deferred charitable gift annuities:

Current Age	Deferral	Annuity Rate
50	15 years	12.8%
55	10 years	9.9%
60	5 years	7.7%

How do I determine if a charitable gift annuity is right for me?
For a personalized illustration of your rates, deductions, and tax benefits, contact the Planned Giving Department.  Contact us.