CHARITABLE
GIFT ANNUITIES
Enjoy a guaranteed income for life and tax benefits by making a
gift that will help future students achieve their dreams of a college
education at Union County College.
WHAT IS A CHARITABLE GIFT ANNUITY?
One of the oldest and simplest life-income arrangements, a Charitable
Gift Annuity (CGA) is a simple contract between you and the
Union County College
Foundation. In exchange for your irrevocable gift of cash or securities,
the Union C.C. Foundation agrees to pay one or two annuitants, designated
by you, a fixed sum each year for life.
Annuity payments are based on the rates recommended by the American
Council on Gift Annuities and are not meant to be competitive with
commercial annuities. The payments are guaranteed by the resources
of the Union C.C. Foundation, and backed by a segregated reserve account.
The minimum gift amount for a Union C.C. Foundation Annuity is $5,000.
WHAT ARE THE ADVANTAGES OF GIFT ANNUITIES?
• It costs nothing to set up a CGA.
• Relatively small amounts can be contributed, compared to
trusts.
• Your income payments are fixed and guaranteed by the assets
of the Foundation.
• Gift Annuities pay relatively high rates, up to 11.3% at
age 90 and over.
• You are entitled to take a charitable income tax deduction
for the gift portion of your annuity in the year you make your gift,
with up to five years to take any unused deduction (subject to the
50% of adjusted gross income limitation).
• If you take a rate lower than the American Council on Gift
Annuities rate, you can increase both your tax deduction and your
ultimate gift to the Union C.C. Foundation.
• You will pay capital gains tax for a gift of appreciated
securities only on the projected income benefit from your gift.
If you yourself are an annuitant, your reduced capital gains tax
liability will also be spread out over the life of the contract.
WHAT ARE THE DIFFERENT TYPES OF GIFT ANNUITIES?
Immediate Payment: Payments begin as soon as the contract takes
effect. You may elect quarterly, semi-annual or annual payments.
Annuitants must be age 55 or older.
Deferred Payment: This option allows annuitants at least 50 years
old to defer the start of payments to age 55 or retirement age.
As for an immediate payment gift annuity, you can take a charitable
deduction in the year you make your gift. Because payments are deferred,
however, you or your designated annuitants will receive higher income
payments later.
ESTABLISHING A GIFT ANNUITY WITH APPRECIATED SECURITIES
If you establish a Gift Annuity with appreciated securities, part
of your gift annuity payments will be taxed to you as capital gain.
In effect, part of the annuity that you would have received as
a tax-free return of investment had you used cash to establish your
annuity will be replaced by capital gain.
However, your reportable gain will be spread over "life expectancy,"
and the total amount of your reportable gain will be less than if
you had sold your stock.
INCOME BENEFICIARY
You decide who receives the income. When you establish your gift
annuity, you can name yourself, a loved one, or yourself and a loved
one jointly, to receive the income every year. If you are the only
beneficiary, the payments will continue for as long as you live.
If you and a loved one are joint beneficiaries, the payments will
continue for as long as either of you live. Your income is guaranteed.
The income you'll receive is a fixed amount that you can depend
on every year; the amount is calculated and included in the annuity
contract. The Union C.C. Foundation uses rates set by the American Council
on Gift Annuities.
WHAT INCOME AND TAX DEDUCTION CAN I EXPECT FROM MY GIFT?
Try our web-based
calculator, which can provide income and charitable deduction
calculations for gift annuities and trusts. You may privately customize
your figures and change your options. Gift calculations are provided
for illustrative purposes only; actual values may vary depending
on variables such as the timing of your gift. The
Union C.C. Foundation
does not provide tax or legal advice. This interactive planned giving
calculator is an additional tool for alumni and friends of the College
to evaluate planned gift options.
HOW DO I SET UP A CHARITABLE GIFT ANNUITY WITH THE UCC FOUNDATION?
It's easy. You sign a standard gift annuity contract and transfer
assets to the Union C.C. Foundation Gift Annuity Fund. Assets will be valued
on the official date of transfer and the Foundation will pay you or
your designated annuitant(s) the agreed-upon percentage in the contract
as a fixed income payment for life.
To arrange for an annuity or to receive a personalized illustration,
please contact the Union C.C. Foundation. You may download and mail, fax
or e-mail the Annuity Form.
Phone: (908) 709-7505
E-mail: uccfound@ucc.edu
FAX: (908) 709-7166
