A charitable gift annuity is a popular way to make a gift to Hadassah and enjoy payments for yourself at the same time. You make a gift of cash or securities of $5,000 or more and will receive a fixed amount annually (payable quarterly, semi-annually or annually) for the rest of your life. The payout rate is fixed when you establish the annuity and remains the same for your lifetime. After your lifetime, the remainder of the annuity is used by Hadassah to support its lifesaving mission. If you yourself do not need the funds, you may establish an annuity as a gift for one or two important people in your life.
“My charitable gift annuity with Hadassah is a wonderful way to give to Hadassah, but it's also a gift to myself.”
If you do not need the money today, but are planning ahead for your retirement years, consider a deferred charitable gift annuity. You establish the gift annuity now and elect to start receiving payments at least one year in the future (so long as you are at least 60 years old when the payments start). You can also establish a deferred gift annuity to benefit a loved one. The longer the deferral period, the higher the payout rate and the larger the charitable deduction.
A charitable gift annuity with Hadassah:
- will provide you and/or a loved one with fixed payments that are partially tax-free for your life expectancy (or combined life expectancies), regardless of market conditions
- may allow you to claim a federal income tax charitable deduction on a portion of your gift in the year you establish the annuity
- may allow you to reduce your capital gains tax liability if you establish the annuity with appreciated securities
- will help to secure Hadassah's future, and your own
Gift Annuity Payout Rates
The payout rate is based on the age of the person or people receiving payments and the number of people receiving payments (one or two). The rate is determined when you establish the gift annuity and, because it is not tied to the stock market or interest rates, it will never change. Please use the gift illustrator to calculate the payout rate and other benefits using your actual date of birth.
| One Life | |
|---|---|
| Your Age | Payout Rate |
| 65 | 5.1% |
| 70 | 5.6% |
| 75 | 6.2% |
| 80 | 7.3% |
| 85 | 8.3% |
| 90+ | 9.5% |
| Two Lives | |
|---|---|
| Your Ages | Payout Rate |
| 70/75 | 5.2% |
| 75/75 | 5.5% |
| 75/80 | 5.7% |
| 80/85 | 6.6% |
| 85/90 | 8.0% |
| 90/95+ | 9.3% |
*Rates as of September 2018.
Examples of How It Works
One-Life Annuity for Yourself Using Cash
Miriam, 70, would like to support Hadassah and generate a secure stream of payments for herself. She establishes a charitable gift annuity with a donation of $10,000 in cash to Hadassah. Based on her age, she receives an annuity payout rate of 5.6 percent. Hadassah will pay her $560 each year for the remainder of her life, of which $376 will be tax-free to her throughout her life expectancy. She may also receive a charitable income tax deduction of $4,016 in the year she makes the gift if she itemizes on her federal income tax return.
Miriam will continue to receive her annuity of $560 if she lives beyond her life expectancy, and the entire amount will then be treated as ordinary income. After Miriam's lifetime, the remaining amount will be used to support Hadassah.
Another Option Using Cash
Miriam, 70, currently owns $10,000 in stock that is producing low dividends. She purchased the stock several years ago for $6,000 and is looking for ways to increase her current income, minimize her capital gains tax and help Hadassah. She decides to establish a $10,000 charitable gift annuity by donating her appreciated stock to Hadassah.
Miriam will continue to receive her annuity of $560 if she lives beyond her life expectancy, and the entire amount will then be treated as ordinary income. A great advantage of funding a charitable gift annuity with a donation of long-term appreciated stock is that the capital gains tax is eliminated on a portion of the gift. If Miriam had sold the securities, she would have immediately realized $4,000 in reportable capital gains. By donating the securities to Hadassah to establish an annuity, she has a total capital gain of only $2,394, reportable over her life expectancy of 15.9 years.
One-Life Annuity for a Loved One
Susan would like to provide her mother Esther, 80, with additional income, but knows that her mother does not wish to accept money from her. Instead, Susan gives $100,000 in cash to Hadassah to establish a gift annuity for her mother. Susan is eligible for an income tax charitable deduction of $49,363 if she itemizes. Her mother will receive annual payments of $7,300 for the rest of her life. Of that amount, $5,387 will be tax-free to her until she reaches her life expectancy (9.4 years). If Esther lives beyond her life expectancy, she will continue to receive her annuity of $7,300, and the entire amount will then be treated as ordinary income.
One-Life Deferred Annuity for a Loved One
Vivian would like to supplement her daughter Carol's retirement income. Carol is 60 years old and plans to retire in 2028. Vivian contributes $50,000 in cash to Hadassah to establish a deferred gift annuity for her daughter, with payments to start on June 30, 2028. Vivian is eligible for an income tax charitable deduction of $23,875 if she itemizes. On June 30, 2028, Carol will start receiving quarterly payments totaling $4,000 each year for the rest of her life. Of that amount, $1,644 is tax-free to her until she reaches her life expectancy (15.9 years). If Carol lives beyond her life expectancy, she will continue to receive her annuity of $4,000, and the entire amount will then be treated as ordinary income.
Two-Life Annuity for Spouses
Gloria, 77, and her husband Melvin, 79, wish to establish an annuity that will continue at the same level for both of their lifetimes. They donate $50,000 in cash to Hadassah to establish a two-life charitable gift annuity. Based on their ages, they will receive a payout rate of 5.9 percent ($2,950 each year for life) and are also eligible for a charitable deduction of $20,260 if they itemize. Of the $2,950, $2,095 will be tax-free for their joint life expectancy of 14.2 years. The annuity will continue after the first spouse passes away. After the second spouse passes away, the remaining amount will be used to support Hadassah's mission.
Two-Life Deferred Annuity for Spouses
Herman, 70, and his wife, Barbara, 65, decide to contribute $250,000 in cash for a deferred gift annuity that will begin making payments when Barbara retires on June 30, 2023. Their gift generates a charitable deduction of $97,2535 in the year they establish the annuity, and they will receive a payout rate of 6.1 percent ($15,250 each year in quarterly payments beginning June 30, 2023). Of the $15,250, $8,174 will be tax-free for their joint life expectancy of 18.7 years. The $15,250 annuity will continue after the first spouse passes away. After the second spouse passes away, the remaining amount will support Hadassah's mission.
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Download My GuideThe information in this publication is not intended as legal or tax advice. For such advice, please consult an attorney or tax advisor. Figures cited in examples are for illustrative purposes only. References to tax rates include federal taxes only and are subject to change. State law may further impact your individual results. Annuities are subject to regulation by the State of California. Payments under this agreement, however, are not protected or otherwise guaranteed by any government agency or the California Life and Health Insurance Guarantee Association. A charitable gift annuity is not regulated by the Oklahoma Insurance Department and is not protected by a guaranty association affiliated with the Oklahoma Insurance Department. Charitable gift annuities are not regulated by and are not under the jurisdiction of the South Dakota Division of Insurance.A copy of our most recently filed financial report is available from the Charities Registry on the New York State Attorney General’s website ( www.charitiesnys.com) or, upon request, by contacting the New York State Attorney General, Charities Bureau, 28 Liberty Street, New York, NY 10005, or us at (LegalAddress). You also may obtain information on charitable organizations from the New York State Office of the Attorney General at www.charitiesnys.com or (212) 416-8401.