A charitable gift annuity is a unique way to donate to your favorite charity while also receiving a steady stream of income for the rest of your life. If you are interested in setting up this type of arrangement, you will need to create a charitable gift annuity agreement. In this article, we will provide you with a sample charitable gift annuity agreement and guide you through the important elements that should be included.
Charitable Gift Annuity Agreement
This agreement is made on [insert date] by and between [insert donor’s name] (hereinafter referred to as “Donor”) and [insert charity’s name] (hereinafter referred to as “Charity”).
Background
The Donor wishes to make a gift to the Charity and in return receive a charitable gift annuity.
The Charity is a tax-exempt organization under section 501(c)(3) of the Internal Revenue Code and is organized and existing under the laws of [insert state].
Agreement
In consideration of the mutual covenants and promises set forth herein, the parties agree as follows:
1. Charitable Gift
The Donor hereby irrevocably gives and grants to the Charity the sum of [insert amount] dollars ($[insert amount]) as a charitable gift.
2. Charitable Gift Annuity
In consideration of the charitable gift, the Charity agrees to pay the Donor an annuity in the amount of [insert annuity amount] dollars ($[insert annuity amount]) per year for the life of the Donor. The annuity payments will be made on [insert payment frequency] a year, starting on [insert date].
3. Use of Charitable Gift
The Charity will use the charitable gift in accordance with its charitable purposes and in compliance with all applicable federal and state laws.
4. Payments
The annuity payments will continue for the life of the Donor. If the Donor dies before receiving the full amount of the annuity payments, any remaining payments will be paid to the Donor’s designated beneficiary. If the Donor does not designate a beneficiary, any remaining payments will be paid to the Charity.
5. Governing Law
This agreement shall be governed by and construed in accordance with the laws of the State of [insert state].
6. Entire Agreement
This agreement constitutes the entire agreement between the parties with respect to the charitable gift annuity and supersedes all prior negotiations, understandings, and agreements between the parties, whether written or oral.
7. Amendment and Modification
This agreement may be amended or modified only by a written instrument executed by both parties.
8. Counterparts
This agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
9. Binding Effect
This agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, executors, administrators, successors, and assigns.
Conclusion
Creating a charitable gift annuity agreement can be a complex process, and it’s important to ensure that all crucial elements are included. By following the sample agreement provided above, you will be on your way to setting up a successful charitable gift annuity while allowing you to support your favorite charity. It’s always advisable to consult with a financial advisor or attorney before entering into any agreement of this nature.