1) Are there any disadvantages to creating a charitable gift annuity?

No, but a donor must remember that establishing a charitable gift annuity is an irrevocable transfer. That is your money can never be returned or refunded.

2) Can I add to my charitable gift annuity later?

No. Each contract is set for life, producing income and tax benefits unique to its creation. However, donors may own as many individual charitable gift annuities as desired.

3) How does Palm Beach State benefit?

The College invests the amount you transfer (your gift) to establish the charitable gift annuity. This is combined with other donor gifts to create a pool which provides interest to pay you income. The College Foundation retains your original gift upon your death. This money is used to support the college’s mission of providing open-access to higher education. The Foundation raises funds to provide student scholarships, support programs such as nursing and paramedic and assist in construction of new classroom buildings when necessary.

4) What is the best asset(s) to use to fund a charitable gift annuity?

The answer depends upon your personal financial situation. If you use highly appreciated securities you can avoid the capital gains tax on the appreciated value. A portion of the annuity payments (income) will be tax free, while the remainder is taxed as ordinary income.

5) How can I learn more about creating a charitable gift annuity?

Contact the Palm Beach State College Foundation or your professional financial advisor.

6) What are the benefits from opening a charitable gift annuity?

● Immediate federal tax charitable deduction

● Guaranteed fixed annual income for life – for up to two annuitants

● Your estate may enjoy reduced probate costs and estate taxes

● If you fund the contract with appreciated stock, bond or mutual fund, a portion of the income will be considered a capital gain distribution.

● Your gift will generously support Palm Beach State to continue its important work

7) Should I consult with my financial advisor?

Definitely. Your financial advisor can help determine the best method for you to use to fund the charitable gift annuity. For instance, if funded with cash your donation is deductible up to 50% of your adjusted gross income (SGI). Gifts of long-term, appreciated securities are deductible up to 30% of your AGI. If your income is not sufficient to use the entire deduction in one year, you can carry forward the unused portion for up to 5 years.

8) How is the annuity rate determined?

Palm Beach State Foundation follows the recommended rates established by the American Council on Gift Annuities. The group meets bi-annually to review the rates. The older the donor, the more income you can receive.

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