Make a GiftYears ago my late husband and I tried to sell a piece of real estate during a down market. We had owned the property for many years and it had appreciated quite a bit. When the property didn't sell our accountant suggested an alternative: donate it to a non-profit organization and receive a charitable tax deduction. That turned out to be great advice. But five years later all of the gift's charitable tax benefits were used up, so we asked him "What now?" His answer was a charitable gift annuity!
From a tax perspective, donating appreciated real estate and funding a charitable gift annuity both allow the donor to receive a charitable tax deduction. The main difference is that when a donor makes a gift that funds a charitable gift annuity, the non-profit pays the donor a guaranteed income stream.
For many years now I have been supporting my favorite organizations by making gifts through charitable gift annuities. In the case of St. Mary's College of Maryland, I make a gift to their Foundation and, in return, I receive a predetermined annual income, a charitable tax deduction, and the knowledge that I am helping a good cause. The rate of return for a gift annuity is determined by the donor's age, the older the donor the higher the return. And in the last few years that rate of return has been significantly higher than the stock market's. Plus I don't have to worry about whether it is going to fluctuate up or down. It remains the same year after year. I would encourage everyone to consider doing what I do. I would add, though, that like I did, you should first check with your accountant!
Teresa Wren
