Planned Giving Insights and Information

BDQ #9: Can I Pay My Pledge With a QCD? How About With My DAF?

Two questions commonly asked by donors, one simple answer: “Yes. Yes, you can!”Of course, there’s a bit more to it. Let’s take this opportunity to explore a little deeper. Qualified Charitable Distribution (QCD)Donors can direct a QCD contribution from their IRA to charity as long as it is for a charitable purpose. This includes making a QCD to pay a pledge. There are some limitations: the donor must be at least age 70½ when the QCD is made, there’s an annual limit on QCDs of $105,000 (in 2024, the limit is adjusted for inflation each year), and the distribution must be made directly from the IRA to the charity.

ACGA Rates Remain Well Below NY Maximum Annuity Rates

New York has announced its maximum one-life annuity rates applicable to immediate gift annuities issued to New York donors from July 1, 2024 through December 31, 2024. 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, and we have spot-checked these rates over a range of typical ages and deferral periods. In every case, the NY maximum rate is well above the corresponding ACGA rate.

Medaling Mortality Tables: Gold, Silver and Bronze Choices for FASB

If you’re a charity following the Financial Accounting Standards Board (FASB) recommendations for calculating the liability of your split interest agreements, you have an important choice to make at the end of each fiscal year: which mortality table to use to calculate your liabilities. While you might hope that your auditor will make a recommendation, the choice of a mortality table lands squarely in the charity’s purview. For charities looking for an opinion on which mortality table to choose, we’re happy to offer a ranking of our preferred mortality tables from bronze to gold. Why the Mortality Table Matters The liability amount is designed to be a good faith estimate of a charity’s obligation to make payments to all gift income beneficiaries for the balance of each individual gift’s term, whether that term is for measuring lives, a term of years, or a combination of the two. Underestimating life spans will deflate a charity’s liability calculation, which can lead to real world...

Why Does the IRS Always Miss My Birthday?

Have you ever had this happen? While preparing the final calculations for your donor, the numbers turn out just a little differently than those you provided in a preliminary illustration. The difference is not substantial. In fact, the deduction is a little larger, so it’s good news. Still, you wonder why. After all, numbers don’t lie. Right? The discrepancy is probably due to the difference between “actuarial age” and actual age, or it could be the historic life expectancy assumptions used for planned gift calculations. First, let’s tackle actual versus actuarial age.