PG Calc Blog

ACGA Rates Remain Well Below NY Maximum Annuity Rates Through 6/30/2025

New York has announced its maximum one-life annuity rates applicable to immediate gift annuities issued to New York donors from January 1, 2025 through June 30, 2025. All these rates remain well above the corresponding maximum annuity rates suggested by the American Council on Gift Annuities (ACGA). New York does not publish its maximum annuity rates for two-life immediate gift annuities, nor for one-life or two-life deferred gift annuities. However, PG Calc is able to compute these New York maximum rates ourselves. We have spot-checked these rates over a range of typical ages and deferral periods, and in every case, the New York maximum rate is well above the corresponding ACGA rate.

Pledge to Make a QCD

When the qualified charitable distribution (QCD) from Individual Retirement Accounts (IRA) was first introduced in 2006, the timing for colleges and universities that push for 50th reunion gifts could not have been better. The new outright gift was available to donors who were age 70 ½ or older, which cleanly aligned with the age of many 50th reunion alumni. In 2006, a donor who was age 70 ½ or older was also faced with making a taxable required minimum distribution (RMD) from their IRA. The QCD outright gift provided relief by allowing a tax-free withdrawal. While there was no charitable deduction, donors benefitted by avoiding ordinary income tax on the portion of their RMD fulfilled by their QCD and receiving reunion credit for their gift. Over time, the age at which a donor could make a QCD gift diverged from the age at which they must begin taking withdrawals from their IRA. In 2025, a donor can make a QCD at age 70 ½ or older, but they are not required to take an RMD until age...

IRS Updates Rules for Computing Planned Gift Deductions

On June 1, 2023, the IRS made public Treasury Decision 9974 (TD 9974). TD 9974 contains final regulations relating to the use of actuarial tables in valuing annuities, interests for life or a term of years in property, and remainder or reversionary interests in property. A change of immediate importance to gift planners, TD 9974 requires use of the 2010CM mortality table when computing the deduction for a gift annuity, charitable remainder trust, or other split-interest gift made on or after June 2, 2023.

Gift Annuity Contracts Filed with State Regulators and the Legacy IRA Act

As we’ve discussed in other blog posts, it is now possible to use a qualified charitable distribution (QCD) from an IRA to fund a charitable gift annuity (CGA). Among the specific requirements set forth in Section 307 of the Consolidated Appropriations Act, 2023 (“the Act”) is that the “income interest” of such an annuity be non-assignable. Our interpretation of the Act is that the income interest in a CGA may not be assigned to anyone, including the issuing charity. Many gift annuity agreements, including those included in PG Calc’s PGM Anywhere and Planned Giving Manager (desktop) software, provide that the annuity is non-assignable “except that it may be assigned to the charity.” That exception is specifically provided for in Reg. Sec. 1.1011-2(a)(4)(ii), which allows for ratable reporting of capital gain when a long-term capital gain asset is used to fund a CGA if the annuity is non-assignable or only assignable to the charity issuing the CGA.