About Charitable Gift Annuities

With a charitable gift annuity, a donor can provide significant support to the university and receive generous fixed payments, partly tax-free income, and a charitable tax deduction.

What is a Charitable Gift Annuity and how does it work? 
When you set up a CGA, you enter into a contractual arrangement with the CSU Foundation.  The contract identifies the donor(s) and states who will receive the annuity, when payments begin, when the contract ends, and how you wish your gift to be used.  As a donor, you make an irrevocable gift of cash, stock, or other assets to the CSU Foundation, and the CSU Foundation agrees to pay you (or someone you name) a guaranteed, fixed annual income for the rest of your (or their) life.

How is the annuity amount determined?
The CSU Foundation uses rate tables prepared by the American Council on Gift Annuities (ACGA), a national non-profit organization.   Annuity rates are determined by the age(s) of the annuitant(s).  The annuitant(s) and the annuity amount never change.

Who may be an annuitant?
One or two people may be annuitants. The donor names the annuitant(s) when the gift contract is prepared. Usually, the annuitant is also the donor. The minimum age of annuitants is fifty-five years of age at the time income payments begin. (The CSU Foundation President may consider and approve exceptions to the minimum age requirements.)

What is the minimum gift amount? 
The minimum amount to establish a Charitable Gift Annuity is $5,000.

Are the gift annuity payments guaranteed?
Yes.  Your gift annuity is guaranteed by the CSU Foundation and backed by its assets.

How will my gift be invested?
The CSU Foundation holds all charitable annuities in a separate account, the "CSU Grants and Annuities Society Trust" at Northern Trust Bank of California in the Los Angeles office.  Gifts remain in the Fund until the gift contract ends.

Are annuity payments taxable?
Part of each annuity is tax free, and part of it is taxable ordinary income.   Gifts of appreciated assets will see some of the capital gain excused, the rest is payable over the course of the annuity.

Will I get a charitable income tax deduction?
Yes.  You may claim a charitable income tax deduction for a percentage of your gift.  For instance, if you are 70, your annuity rate is 7.2% and you are eligible for a charitable deduction is approximately 35% of your contribution.  US Treasury tables set the deduction, based on the annuitant's age, the annuity rate, and date of the gift.  Ask the CGA Campus Coordinator to estimate your deduction.

When do annuity payments begin?
Donors chose when payments begin, either immediately or deferred for more than a year.
Immediate annuities start payments within a year of the gift date.
Deferred annuities delay payments but still generate a current income tax deduction.  The annuity rate and tax deduction for a deferred annuity will be higher than what you will enjoy from an immediate annuity.

What will my gift support?
The continued excellence of the educational mission of the California State University depends upon the generosity of its friends.  Why? Because the minimal costs of educating the hundreds of thousands of students coming to the CSU each year is only partially covered by student fees (20 percent) or state support (less than 75 percent).   To close the gap and to advance beyond the basics, requires private support. Individual gifts to the university provide the margin of excellence that enhance the higher learning experience.

For further information, contact:
Anne Gillespie Brown
Director, Foundation Programs and Services
Office of the Chancellor,
401 Golden Shore, 6th Floor
Long Beach, California 90802-4210
(562) 951-4768
or e-mail abrown@calstate.edu