Good Counsel: The Benefits of Charitable Gift Annuities

By Blake Grossman, associate director of planned giving

Fall 2018

As Sheldon Kay and Katherine Cameron have learned [1], a charitable gift annuity will provide you with annual payments for life and create a lasting legacy at Stanford. A charitable gift annuity [2] is one of several types of life income arrangements available at Stanford.

Most charities, including Stanford, use the charitable gift annuity rates suggested by the American Council on Gift Annuities (ACGA), a national organization. These rates vary depending on the age, at the time the annuity is established, of the person who will receive payments. As of July 1, 2018, the ACGA increased its suggested rates, which means that the rates offered by Stanford have also increased by about 0.5 percent over rates offered in recent years.

My colleagues and I are happy to work with you and/or your advisors to consider whether a charitable gift annuity at Stanford is right for you. While there are a variety of options that can be explored to best meet your goals, the standard process for establishing charitable gift annuities is as follows:

• You and Stanford sign a charitable gift annuity agreement, including your wishes about how Stanford will ultimately use your gift.
• You make a gift of cash or publicly traded securities (minimum $20,000) to Stanford.
• You are entitled to a charitable income tax deduction for a portion of the value of your gift. If you give appreciated securities to establish a charitable gift annuity, you may save and/or defer capital gains taxes.
• Stanford pays for you (and/or another named beneficiary) a fixed amount each year for life. The payment amount is based on a rate determined by the age of the annuitant(s) at the time the annuity is established. For example, if a 70-year-old donor were to establish a charitable gift annuity for herself with a gift of $50,000, her annual payment, based on the rates Stanford currently offers, would be $2,800 (5.6 percent of $50,000). Typically, a portion of each annuity payment is tax-free.

After making your gift, you will be invited to join Stanford's Founding Grant Society. Note that a charitable gift annuity counts toward your "reunion campaign's total" if you are in a reunion year.

To learn more about charitable gift annuities or other life income gifts, please contact the Office of Planned Giving at 650.725.4358.