A charitable gift annuity is an agreement between a donor and Oklahoma State University Foundation (OSUF). Under the terms of a gift annuity agreement, OSUF agrees to pay a fixed lifetime annuity payment to one or more beneficiaries in exchange for the donor’s charitable gift to benefit OSU after the death(s) of the beneficiary(ies). In addition to the annuity payment, the donor also receives a current income tax deduction for part of the gift’s value. OSUF uses a rate of payment fixed by the American Council on Gift Annuities. Please see calculator for specific calculations.
Requirements for Establishing a Charitable Gift Annuity (CGA)
The donor must make a gift of $5,000 or more to create a CGA. Gift annuities are typically funded with cash or marketable securities. Use of other assets for gift annuities must first be approved by the OSU Foundation President and CEO.
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Requirements for Beneficiaries
A maximum of two annuity payment beneficiaries may be included on a gift annuity contract. The minimum age of a beneficiary to whom an immediate payment will be issued is 50 years. Payment from a deferred gift annuity may not begin until the younger beneficiary is 50 years or older.
There is one exception – Charitable Education Annuities. These are typically paid to the beneficiary for a limited number of years while the beneficiary is in school. These could be advantageous vehicles to pay for the education of grandchildren, children, nieces or nephews. In either case, the receipt of annuity payments from a deferred gift annuity may be deferred for a period of not more than 20 years.
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Deferred Payment Gift Annuities vs. Current Gift Annuities
CGAs may be structured so that the annuity payments to beneficiaries begin immediately or are deferred until a future date. One common deferred payment annuity is the Charitable Education Annuity, explained above. By deferring the annuity payment for one or more years, the donor may receive a larger current charitable deduction and a higher payout when the payments begin.
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Use of the Residuum to Benefit OSU
The donor may designate how and for what purpose the assets shall be used by Oklahoma State University after the death of the final income beneficiary. The donor may designate that the remainder (or residuum) be used to benefit a particular program or college at OSU. Depending on the amount remaining, the residuum could be used to establish an endowed scholarship fund to be benefit OSU students in perpetuity.
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Tip: Appreciated marketable securities could be an attractive choice for funding a charitable gift annuity because capital gains taxes can be avoided.
Contact Us
If you have any questions about any charitable giving information or opportunities to support a specific college or program, please contact the Office of Planned Giving at (800) 622-4678 or plannedgiving@osugiving.com.
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