It’s simple: you can help the Library Company and receive an income for life at the same time. And, at rates much better than a bank CD. A charitable gift annuity is both a gift and an investment. You contribute cash, marketable securities, or other assets to the Library Company in exchange for our contractual promise to pay you and, if you wish, another annuitant, a guaranteed income for life. You qualify for an immediate tax deduction and in most cases, each payment to you is tax-free.

 

A Brief Example

 

Thomas and Elizabeth Martin want to establish an endowed publication find in their names. Mr. and Mrs. Martin, ages 73 and 70, do not feel comfortable reducing their income at this time. Years ago they acquired stock for $30,000. That stock is now worth $75,000 and pays 2.5% ($1,875) in dividends annually. If the Martins transfer this stock in exchange for a charitable gift annuity, they may receive $4,875 (6.5% of $75,000) each year, thereby increasing their income from this asset. They may also spread the payment of their capital gain over their joint life expectancies and will be eligible for an income tax charitable deduction approximately equal to $32,500 based on the calculation the Internal Revenue Service requires using the Martins' ages, the annuity rate, and an assumed rate of return.

 

Their annual income of $4,875 comprises $354 in tax-free return on their investment, $1,850 in capital gain, and $2,671 in ordinary income. If the Martins transfer cash, the picture remains the same except that their annual income comprises $2,203 in tax-free income and $2,672 in ordinary income.

 

If the Martins felt comfortable deferring the beginning of their annuity payments for two years, they could increase their charitable deduction to approximately $34,500 and increase their annuity rate to 7.8%.

 

In either case, the Library Company will credit Mr. and Mrs. Martin with having made a gift of $75,000 and will establish the named publication fund at the conclusion of the annuity payments.

 

Click here for sample gift annuity rates.

 

Personalize it! For a personal illustration of how a charitable gift annuity can help you while benefiting the Library Company, please contact our Development Office at (215) 546-3181 ext 133 or click here.