Charitable Gift Annuity
A charitable gift annuity is a contract between the donor and one of the Masonic Charities. You transfer cash or appreciated securities held long-term to your favorite Masonic charity. In return, you (and/or someone you designate) will receive regular cash payments for as long as you (and or your designee) live. You may realize additional tax savings, since a portion of the gift asset's appreciation will bypass the capital gains tax. You also receive an immediate tax deduction for part of the amount transferred, subject to the same rules of deduction for gifts of cash or long-term appreciated securities as for outright gifts.

A charitable gift annuity has an attractive provision for the taxation of each cash payment. Initially a portion of each payment is treated by the IRS as nontaxable return of the donor's principal; another portion is taxed as a capital gain to the donor if long-term appreciated assets have been contributed; and the balance is taxed as ordinary income. After any capital gains and the principal are recovered, all remaining cash payments are treated as ordinary income. A charitable gift annuity may have no more than two income beneficiaries.

The minimum contribution to establish a charitable gift annuity is $5,000. The minimum age for a one-person charitable gift annuity is 40 and for a two-person charitable gift annuity at least one person must be age 50.

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