Life-Income Plans: Charitable Gift Annuity

What follows is a general introduction to life income plans and Charitable Gift Annuities specifically. Whether or not you are considering San Francisco Opera as a charity of choice, we hope you find everything in this explanation useful for your consideration.

Lifetime Income To You or Your Loved Ones

Generally, you may fund your charitable life-income gift with cash, stock, real estate, a Qualified Charitable Distribution (QCD) from your IRA, or a combination. Assets placed in a life-income gift pay you or your beneficiary (such as a friend or relative), called “income beneficiaries,” income for life or for a predetermined term of years. After the income beneficiaries’ death, or upon the end of the term, the remainder passes to charity.

Other Benefits

Your life-income gift may provide you with some important tax benefits:

1) An immediate income tax deduction for a percentage of your gift. We will be happy to give you an idea of the size of your deduction. Simply provide us with the age of the income bene-ficiary(ies) and whether you prefer a life gift or a fixed term gift.

2) No tax on the sale of appreciated property. From your point of view, this is often the most important tax benefit. Sometimes thousands of dollars that would have gone to taxes remain in the plan, generating income to you or others.

3) The plan principal avoids estate tax. Property that might otherwise be subject to estate tax is preserved from that tax entirely.

Chariable Gift Annuities

A charitable gift annuity is a simple contract between you and a charity. Unlike other life-income plans, a portion of the income is free of income tax. Annuities work best for those who are 70 or older. The older you are when establishing (or first receiving payments from) the annuity, the more income you and/or another income beneficiary will receive. San Francisco Opera is not currently licensed to issue gift annuity contracts; however, you have a couple of options that will benefit the Opera: Silicon Valley Community Foundation and the National Gift Annuity Foundation both issue charitable gift annuities that allow you to designate the Opera as beneficiary. We would be happy to provide salient information about the process and foundations. You can also find information on each of these organization’s websites here:

National Gift Annuity Foundation: https://nationalgiftannuity.org/

Silicon Valley Community Foundation: https://www.siliconvalleycf.org/donors/charitable-giving-options/charitable-gift-annuities

For More Information

The basic advantages of life-income plans are easy to understand: Avoidance of capital gains tax on the sale of appreciated property, lifetime income, immediate income tax benefits, reduction of any estate tax, and the satisfaction of providing for a good cause. As noted, these plans can even benefit your loved ones. But the first thing you should do is find out if a life-income plan makes sense for you.

If you have questions, please contact the Opera’s legacy giving team. Thank you for requesting this information, and for supporting San Francisco Opera.

Alondra Orellana
Associate Director of Individual and Legacy Giving
(415) 565-6431
aorellana@sfopera.com

Maude Engström
Legacy Giving Manager
(415) 565-3242
mengstrom@sfopera.com
legacygiving@sfopera.com