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Deferred Gift Annuities
(Complete gift description)
This version of the charitable gift annuity is especially designed for younger donors. Called the deferred gift annuity, it makes fixed annual payments to you and/or another beneficiary for life, with payments commencing at a future date. If you prefer to delay receiving income for some period of time, you may make a deferred payment charitable gift annuity contribution. Making a present transfer of assets while deferring the start of income payments will enable you to increase your income tax deduction or to increase the amount of the annuity payments. Because of the deferral of income:
- Yale can offer a higher income rate for these annuities than for annuities whose income starts immediately, and
- You may receive a larger charitable income tax deduction than you could get from any other life-income gift plan.
These two features make the deferred gift annuity quite attractive to donors in high-earnings years who are concerned about securing both current tax deductions and additional sources of retirement income.
Use a deferred gift annuity to help plan for retirement
Many donors establish a series of deferred annuities over several years, using funds they had already set aside for retirement saving. They set the commencement date for payments from these annuities to coincide with their or their spouse's retirement.
Planning points
The deferred gift annuity offers the same benefits of simplicity, security, and attractive income taxation that the regular gift annuity provides our donors:
- Your deferred annuity is a contract between Yale and you, and your annuity payments are an obligation backed by the assets of the University;
- You secure a charitable income tax deduction based on the market value of the assets you contributed, minus the present value of the life-income interest you retained;
- No up-front capital gains tax is payable if you fund your deferred gift annuity with appreciated securities; only a portion of your gain is recognized, with the tax spread over your annuity payments;
- Part of each annuity payment to you comes tax-free as the return of principal;
- The balance remaining in your deferred annuity after the death of the beneficiaries will be used by Yale for the purpose you designated when you created the gift annuity.
- A deferred gift annuity at Yale can be made with a gift of 10,000 or more.
How do you create a deferred gift annuity?
We will provide information on deferred gift annuities for your review and a disclosure statement. As always, we encourage you to seek the advice of your attorney or financial adviser. We'd be happy to share additional material with them.
For more information
Email us, complete the personal illustration form, or call us at 1 (800) 445-6086 so that we can assist you through every step of the process.