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Planned Giving: Life Income Gifts

You can make a gift to the Unitarian Universalist Association (UUA) that will pay you income for life, after which the remaining gift principal will be turned over to the UUA, your home congregation, or any other Unitarian Universalist (UU) organization, for any purpose you specify. A life income gift may be appropriate if you want to make a gift but need to retain income for yourself and/or loved ones. Giving highly appreciated securities may be especially attractive. A life income gift can reduce your capital gains taxes and increase your income.

There are three primary types of life income gifts...

1. Charitable Gift Annuities

A charitable gift annuity is an arrangement whereby you contribute cash or marketable securities in exchange for the Association's promise to pay one or two people a guaranteed income for life at a rate based on the age(s) of the annuitant(s). If you are planning for retirement or want to increase income, reduce capital gains taxes, secure a fixed income, and make a significant gift to the future of Unitarian Universalism, then this option may be right for you.

You may also delay receiving income for some period of time, thereby increasing the payments you receive. This can be a powerful tool for retirement planning, if you want to lock in a higher income for future years, when you need it most. “The longer you wait, the higher the rate!”

Charitable Gift Annuity donors are eligible for an income tax deduction in the year the gift is made. They also receive favorable tax treatment on the annual income. A gift of $10,000 or more will establish a charitable gift annuity for you and your loved ones to enjoy. Read more about charitable gift annuities.

2. Pooled Income Fund

The UUA Pooled Income Fund (PIF) is similar to the Charitable Gift Annuity Fund in that the donor(s) receive a charitable tax deduction in the year the gift is made and the benefits of a lifetime income stream for up to two beneficiaries, usually the donors.

Participants receive taxable quarterly payments representing their share of the actual interest and dividend earnings of the PIF investments. Payments will vary according to investment performance. The value of the gift made to the UU entity after the income recipients have died is often equal to or greater than the original contribution, so this is a wonderful gift for donors who can tolerate a variable payment rate. The three-year high stands at 3.62% through 2013.

The minimum initial amount is $5,000 for a gift that will benefit one or two qualified UU organizations. You can add to your original gift in increments of $1,000 or more.

Read more about the Pooled Income Fund (PDF)

3. Charitable Remainder Trust

A charitable remainder trust (CRT) allows you to retain income for an unlimited number of individuals, provide specialized management of your gift, and it may increase your capacity to make gifts to your favorite charities.

A charitable remainder trust is a separately invested irrevocable trust you create by designating a person or persons to receive annual income payments. Trusts can accept a wide range of assets, including cash, securities, closely held stock, or real property. At the conclusion of the income payments, the trust principal is distributed to the named charities.

A charitable remainder trust involves administrative and start-up fees. Because of the increased flexibility of this gift option, it can also be somewhat complicated. Therefore, trusts must have a minimum value of $100,000.

Custodian

The UUA Charitable Gift Annuity fund is held in trust by State Street Global Advisors, in Boston. This is a segregated trust account, held separately from other UUA assets.

Gifts to Benefit Your Congregation or UU Entity

The UUA operates the annuity fund and the pooled income fund as a free service to our congregations. This means that individuals may make gifts to the fund and name their home congregation as the sole charitable beneficiary. The Association acts as trustee of this gift, and all others in the funds, and charges no fees to the congregation.

For more information contact giftplans @ uua.org.

This work is made possible by the generosity of individual donors and congregations. Please consider making a donation today.

Last updated on Thursday, November 7, 2013.

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