The Community Foundation is here to support organizations building endowment with us. We offer advice, training, administrative support, investment, planned-giving expertise, and more to help you and your donors make a lasting impact on our region.
CHARITABLE GIFT ANNUITY PROGRAM
Nonprofit organizations building endowment at the Community Foundation are eligible to participate in our Nonprofit Agency Charitable Gift Annuity Program if their endowment fund balance is $100,000 or more, they have one full time development person, they attend training on gift annuities and agree to only use Community Foundation approved materials in connection with the gift annuities.
A Charitable Gift Annuity (CGA) is an agreement between a donor and the Community Foundation. A donor contributes cash and/or marketable securities and the Community Foundation agrees to pay the donor and/or the beneficiaries (no more than 2 lives total) a fixed annuity payment for life. The donor gets an immediate income tax deduction. Upon the death of the last income beneficiary, 90% of remainder goes to the endowment fund benefiting the designated organization, and 10% to the Community Foundation’s unrestricted endowment fund. The unrestricted endowment supports nonprofit organizations and programs throughout southeast Michigan.
Agency endowment funds can be used in connection with the following:
- Charitable Gift Annuities (CGA)
- IRA Charitable Rollover gifts (also known as QCD)
- Beneficiary designations (deferred plans/IRA/insurance)
- Charitable remainder trusts, charitable lead trusts, and other planned gifts
Donors benefit from charitable gift annuity arrangements through an immediate income tax deduction. Also the donor and/or the beneficiaries retain the right to receive income from the gifted property in the form of an annuity payment (possibly higher than the income currently being generated by the gifted property) which is partially tax free. They also realize a deferral or avoidance of capital gains taxes. And they can be confident that the Community Foundation stands behind the annuity obligation.
CGA Process and Your Organization
The nonprofit’s role is to identify those prospects who would benefit from this form of planned giving. Most utilize their volunteers and planned giving committee to assist them in identifying prospects. Customized marketing materials are available and complimentary (see examples.)
The Community Foundation coordinates with the development staff to create a proposal when the organization has an interested donor. The Community Foundation handles all the paperwork and provides illustrations, disclosures and agreements. We take care of the gift processing and tax acknowledgments. We also make the annuity payments and send annual tax information to the annuitant.