Charitable Gift Annuities Explained

by Mark Kennan ; Updated July 27, 2017
Image of charitable gifts.

Charitable gift annuities provide a way for someone with philanthropic intentions to give money to charities up front in exchange for a stream of guaranteed payments over the remainder of her life. In addition to helping worthy causes and getting paid for it, donors also receive a partial income tax deduction for the contribution.

Charitable Gift Annuity Function

When you make your gift to the charity, the charity agrees to pay you a percentage of the gift each year based on your age. The older you are, the higher the percentage payment can be, because you have a shorter remaining life expectancy. Or, if you're married and want the payments to continue for the life of your spouse if he outlives you, you can accept a smaller percentage to ensure the payments continue after the first of you dies.

About the Author

Based in the Kansas City area, Mike specializes in personal finance and business topics. He has been writing since 2009 and has been published by "Quicken," "TurboTax," and "The Motley Fool."

Photo Credits

  • mangostock/iStock/Getty Images
Cite this Article A tool to create a citation to reference this article Cite this Article