More about Deferred Charitable Gift Annuities

The deferred charitable gift annuity, designed for younger donors, makes fixed annual payments to you and/or another beneficiary for life, with payments commencing at a future date. Because payments are deferred:

• California Hospital Medical Center Foundation can offer a higher payment rate for these annuities than for annuities whose payments start immediately, and
• You receive a larger charitable income-tax deduction than you could get from any other life-income gift plan.

These features are attractive to donors, in high-earning years, who are concerned about securing both current tax deductions and additional sources of retirement income.

Is there a way to use the deferred charitable gift annuity as a retirement planning device?

Many donors establish a series of deferred annuities over several years, using funds they had already set aside for retirement saving. They set the commencement date for payments from these annuities to coincide with their or their spouse's retirement.

Is this permissible?

It certainly is – to help individuals ultimately support charities, like California Hospital Medical Center Foundation, that are important to them. The deferred charitable gift annuity offers the same benefits of simplicity, security, and attractive income taxation that the regular gift annuity provides donors:

• Your deferred annuity is a contract between California Hospital Medical Center Foundation and you. Your annuity payments are an obligation backed by the Foundation's corporate assets;
• You receive a charitable income-tax deduction based on the market value of the assets you contributed, minus the present value of the life-income interest you retained;
• No up-front capital-gains tax is due if you fund your deferred gift annuity with appreciated securities; only a portion of your gain is reportable over your annuity payments;
• Part of each annuity payment to you comes tax-free as the return of principal;
• California Hospital Medical Center Foundation will use the balance remaining in your deferred annuity after the death of the beneficiaries for the purpose you designated when you created the gift annuity.

What are the restrictions to deferred charitable gift annuities?

To protect everyone's interest, a deferred annuity may be created with a gift of $10,000 or more.

How do you create a deferred charitable gift annuity?

You should be advised by an attorney or other advisor with expertise in charitable trusts and estate planning. California Hospital Medical Center Foundation will work with your advisors to help meet your financial and philanthropic goals. If you do not have an attorney, California Hospital Medical Center Foundation can provide a referral. Once the final agreement is signed, you can fund your lead trust by transferring assets to your trustee.

For assistance with this gift plan, please complete the request information form or contact Susan Shum at (213) 742-5662 or email to susan.shum@dignityhealth.org