Tag Archive for: Grace of Giving 112022

The Charitable Gift Annuity: A Gift That Pays Income for Life

After 35 years of teaching, Arnie Nommensen began serving in a different way: as a WELS Christian giving counselor. In his role, Arnie met a WELS member who made quite an impression on him. This member had seen firsthand the blessings of charitable gift annuities (CGAs), so Arnie helped him set up multiple CGAs to leave a legacy of faith.

Motivated by this example and out of thankfulness for God’s blessings, Arnie knew that setting up CGAs to support the Lord’s work was also right for him and his wife, Carol. They knew that even after God calls them home, their CGAs will continue to support the ministries they love, like providing physical and spiritual support in Africa through WELS Christian Aid and Relief.

“You hear about things that WELS Christian Aid and Relief is doing in Africa for communities that really have a need, and that community then is also hearing the gospel from the people who are there to help them,” says Arnie. “The support that we can give through a charitable gift annuity will help provide that, and that’s something that can be carried on after we’re in heaven.”

CGAs are very popular since they provide quarterly income payments to the donor for life, in addition to significant tax benefits. When the Lord calls the donor home, the remainder will be distributed to the ministry or ministries of the donor’s choosing.

Carol appreciates how CGAs allow them to share their blessings with others: “They’ve given us the ability to use our financial gifts from the Lord to help or give back to him in a small way, because he gives us so much,” she says. “And it really gives us joy to do that.”

Run a personalized gift annuity illustration based on your age

Learn more about charitable gift annuities by contacting your local WELS Christian giving counselor at 800-827-5482 or [email protected].

Watch Arnie and Carol’s full charitable gift annuity story 

A Smart Option for Giving

If you are age 70.5 or older, you can support WELS ministries and churches through a gift directly from an individual retirement account (IRA) called a qualified charitable distribution (QCD).

Why is a QCD such a good giving option?

  • Giving directly from your IRA—rather than withdrawing these funds—won’t increase your adjusted gross income or subject your Social Security income to more taxes.
  • Such gifts can count toward all or part of your annual required minimum distribution (RMD). While IRA owners age 70.5 or older can make gifts directly to charities from their IRAs, the minimum age for taking RMDs has increased to 72.
  • QCD gifts can be especially advantageous for those who do not expect to itemize their deductions and for those whose deductions are limited.
  • You may make QCD gifts in any amount up to $100,000 per person per year or $200,000 for a couple with separate IRAs. Because of recent tax law changes, you may be able to continue to add to an IRA after age 70.5. If this is your situation, the amount of QCD gifts you can make will be reduced.*

Learn more about making QCDs from your IRA at wels.net/helpful-giving-tools or by contacting your local WELS Christian giving counselor at 800-827-5482 or [email protected].

*As a result of the SECURE Act, if an individual with earned income continues to make deductible contributions to an IRA beyond age 70.5, the individual’s maximum QCD amount will be reduced by the amount of deduction claimed for an IRA contribution.

Helpful Giving Tools

WELS Foundation provides resources to support you in your giving, such as:

Consider Being “Flexible” in Retirement

For those looking for new ways to support WELS’ mission to spread the gospel of Jesus Christ while still providing for their retirement needs, they may be surprised to learn about a way they can do both: the flexible deferred charitable gift annuity.

  1. With this creative plan (which is a variation of the simple charitable gift annuity), you can meet current and future income needs. While IRS regulations limit contributions to IRAs, 401(k)s, 403(b)s, and other retirement plans, there are no such limitations with this plan.
  2. You can create a plan that maximizes your current income tax deduction while retaining the flexibility of receiving payments at the time you choose.
  3. Lastly, a flexible deferred annuity provides protection should an income need arise due to an uncertain future event (such as placing a relative in an assisted living facility or helping someone with in-home care). Payments can begin if or when the need arises.

A good example

As Bill and Jane prepared for retirement, they wanted to set aside resources to supplement their retirement income, while eventually benefiting a number of WELS ministries, including their home church. With the flexible deferred charitable gift annuity, they fulfilled these objectives.

Over a period of years, Bill and Jane created several flexible deferred charitable gift annuities and can begin receiving the payments in the future.

  • They met part of their Christian giving goals, named their favorite ministries to receive the remainder of the annuities, and had large deductions to use against their current income.
  • Annually they have the choice to begin receiving the payments.
  • When the payments begin, they may decide to use their payments to support the Lord’s work and would receive additional income tax deductions for those gifts.

Charitable gift annuity illustration

 

 

 

 

 

 

For more information about this creative plan or charitable gift annuities, contact a WELS Christian giving counselor at 800-827-5482 or [email protected].