How it works
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You transfer cash, securities, or other assets to Wentworth Institute of Technology. |
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Wentworth pays you (or up to two annuitants of your choice) a fixed income for life. |
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The remaining balance passes to Wentworth once the contract ends. |
What is a Charitable Gift Annuity?
A Charitable Gift Annuity is a simple contract between you and Wentworth Institute of Technology. In exchange for your gift of cash, securities, or other assets, Wentworth agrees to pay one or two people of your choice (annuitants) a fixed sum each year for life. The payments are guaranteed by the general resources of Wentworth.
The older your designated annuitants are at the time of the gift, the greater the fixed income they will receive:
Charitable Gift Annuity Rates
(Single Life) |
| Age |
Income |
65 |
6.0% |
| 70 |
6.5% |
| 75 |
7.1% |
| 80 |
8.0% |
| 85 |
9.5% |
| See the entire chart. |
In most cases, part of each payment is tax-free, increasing each payment's after-tax value. If you give appreciated property, you will pay capital gains tax on only part of the appreciation. In addition, if you name yourself as an annuitant, the capital gains tax will be spread out over many years rather than be all due in the year of your gift.
Payments are usually made in annual, semiannual, or quarterly installments.
The minimum donation for a charitable gift annuity is $10,000.
Benefits
- Your fixed annual annuity payments are guaranteed for life, backed by the assets of Wentworth Institute of Technology.
- You will qualify for an immediate federal income tax deduction for a portion of your gift.
- Your annuity payments are treated as part ordinary income, part capital gains income (15%), and part tax-free income.
- If you fund the annuity with an appreciated asset, you will incur tax on only part of the gain. If you name yourself as an annuitant, this tax will be spread out over many years.
- Your estate may benefit from reduced estate taxes.
- Your gift will benefit you now, and will benefit Wentworth later.
An illustration
Harry, Class of 1956, is 72 years old. Harry would like to make a gift to Wentworth to support the Electronics and Mechanical Department using 500 shares of stock that he bought years ago for $12,500. The shares have now appreciated to $25,000. Currently, the stock does not pay a dividend.
Harry would like to make a gift to Wentworth, but he also wants to receive income from his stock. Harry can enter into a Charitable Gift Annuity agreement with Wentworth by which:
- Wentworth will pay Harry an annual fixed income of $1,675 for life, a portion of which will be completely tax-free.
- Harry will receive a charitable federal income tax deduction of approximately $10,000.
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Please note that information and calculations are for illustration purposes only and should not be considered legal, accounting, or other professional advice. Your actual benefits may vary depending on the timing of the gift. |
