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Charitable Gift Annuity

The charitable gift annuity is one of the oldest forms of gifts with retained income. It may seem strange to think of a gift that is associated with income. However, this type of gift may be an appropriate answer to those donors who wish to make a meaningful contribution to Northern Illinois University while at the same time creating, maintaining, or enhancing an income stream for their own economic security.

What is a charitable gift annuity? Simply, it is a legal agreement between an individual(s) and Northern Illinois University Foundation in which the donor gives money, securities or real estate, and in return, the Foundation agrees to pay the donor a fixed income for life.

The amount of income received is determined by the value of the gift and the annuity rate. The annuity rate is determined by the donor's age at the time the gift is made.

The following tables list applicable annuity rates for certain ages:

ONE LIFE
(yourself)

TWO LIVES
(yourself and another) 
AGE  RATE AGE RATE
60 5.7% 65/60 5.5%
65 6.0% 70/65 5.7%
70 6.5% 75/70 6.1%
75 7.1% 80/75 6.6%
80 8.0% 85/80 7.3%
85 9.5% 90/85 8.4%
90 11.3% 95/90 10.1%

Given current market conditions, the rates are generating significant interest among donors.

EXAMPLE: Sarah B., age 76, contributed $10,000 to NIU Foundation in exchange for a gift annuity that will pay her 7.2% for the rest of her life. Her annual income will be $720, paid in quarterly payments of $180.

Additional Benefits:

  1. Only $225 of the annual income is taxable as ordinary income. The remaining $495 comes to her tax-free.
  2. The charitable tax deduction is $4,165. At maturity of the annuity, this program provides gift support for NIU student scholarships, faculty research, program needs and other important initiatives. Private gifts, such as gift annuities, allow Northern to recruit and retain the best students and faculty, update facilities to reflect the requirements of new technology, maintain a world-class library and support cutting-edge research that makes a difference in all our lives.

We hope you will take advantage of the Charitable Gift Annuity program as a unique economic and charitable opportunity. For further information, please contact John Sentovich, Director of Gift Planning, at 815-753-1344 or e-mail sentovich@niu.edu to discuss your specific needs and the mutual advantages of the gift annuity.