American Farmland Trust - Deferred Gift Annuity

Deferred Gift Annuity

The deferred gift annuity permits members who are planning for their retirement to make an early investment in his/her future. With a deferred gift annuity, the donor transfers the funds to American Farmland Trust now, but chooses to delay the first payment until a specific future date. Many donors who choose to give through a deferred gift annuity choose their anticipated year of retirement as the trigger date for annuity payments, but any date is acceptable. The longer the delay between the donation and the first payment, the higher the amount of the annuity payment and the larger the income tax deduction. See the chart below for a comparison of rates.

Deferred Gift Annuity	Immediate Gift Annuity	Deferred Gift Annuity
Age at Time of Transfer	60	60
Age at First Payment	60	70
Amount	$20,000	$20,000
Annual Annuity Payment	$1,140 (5.7%)	$2,100 (10.5%)
Charitable Tax Deduction	$4,538	$7,751

*These calculations are for illustration purposes only and should not be considered legal, accounting, or other professional advice. Your actual benefits may vary depending on the timing of the gift.

Using Appreciated Securities to Establish Your Deferred Gift Annuity

To maximize your tax savings, you can choose to fund your deferred gift annuity with long-term appreciated securities, rather than cash. To qualify as a long-term security, you must have held the stocks or mutual funds for at least a year and a day at the time of donation. Appreciation refers simply to the growth in the asset's value since the time you acquired it. By using highly appreciated securities rather than cash to fund a deferred gift annuity, you can realize substantial savings on the capital gains tax you would normally pay if you were to sell these securities yourself.

No matter the type of bequest you choose to make, the assets will be removed from your estate for the purposes of taxation.

Our planned giving office is here to help you determine the type of gift that's right for you. You can contact AFT's Vice President of Development and External Affairs, Susan Sink at 202-378-1206 or ssink@farmland.org to make American Farmland Trust a part of your lasting legacy.