PG Calc Blog

On May 15, 2018, the American Council on Gift Annuities (ACGA) announced new suggested maximum gift annuity rates to replace the rates that became effective on January 1, 2012. The new rates will apply to gift annuities established on or after July 1, 2018. The new suggested maximum rates are moderately higher than the ones they replace. The new rates were set with the goal of 50% of the funding amount remaining for the charity on average. The rates also ensure a 20% present value and a contribution value of at least 10% of the funding amount at all ages down to an IRS discount rate of 2.8% (as compared to 1.4% under the January 1, 2012 rates). These additional criteria cause the maximum rates suggested for very young ages (under 20) to be lower than they otherwise would be.

In the realm of gift planning, there are a number of terms that we use often. For those new to gift planning or those looking for a refresher, this is the first in a series of articles entitled: “5 Terms Every Gift Planner Should Know.”