Elective commencement date gift annuity example

Bob and Sue, ages 50, are looking for ways to increase their retirement income.
They have come to understand that a contribution to a gift annuity is not subject to the limitations of typical retirement plans. They can establish a gift annuity now and defer the annuity payments until they retire. However, they are not exactly sure when they will retire so they want to be sure their plans include flexibility.

An elective start gift annuity agreement includes a number of possible starting dates for your annuity. Bob and Sue will benefit from an immediate income tax deduction. The deduction will be based upon the first possible starting date for their gift annuity.


Contribution amount $20,000.00
Immediate annuity rate (age 50, 50) 4.4%
Charitable income tax deduction - based on age 60 start $3,292.20

Age at Start Date Annuity Payout Rate Tax-free Portion Ordinary Income Total Annual Annuity
60, 60 8.3% $364.40 $1,095.60 $1,660.00
62, 62 9.2% $603.52 $1,236.48 $1,840.00
65, 65 10.8% $671.76 $1,488.24 $2,160.00
67, 67 12.1% $723.58 $1,696.42 $2,420.00

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