Charitable gift annuity rates are published by the American Council on Gift Annuities, and nearly every charity in the country uses them. The current single-life schedule took effect on 1 January 2024 and was reconfirmed by the ACGA board in April 2024.
The rates themselves are easy to find. What is harder to find is an explanation of what sits underneath them, because almost every page publishing these numbers belongs to an organization that receives the money if you say yes.
What Are the Current Charitable Gift Annuity Rates
Single-life charitable gift annuity rates currently run from 5.2% at age 60 up to a cap of 10.1% at age 90 and older. Selected ages from the published schedule:
- Age 60 · 5.2%
- Age 65 · 5.7%
- Age 70 · 6.3%
- Age 75 · 7.0%
- Age 80 · 8.1%
- Age 85 · 9.1%
- Age 90 and above · 10.1%
Two-life rates run lower at every age and are capped at 9.9%, because the charity expects to make payments across two lifetimes rather than one. Rates are set by age at the nearest birthday.
Rates rise with age for a straightforward reason. A shorter expected payment period means fewer total payments, so the charity can afford a higher annual rate while still ending up with what it needs.
Are Those Rates Guaranteed
The ACGA schedule sets a ceiling rather than a floor. A charity may pay less than the suggested rate, and it may not pay more.
Once a contract is issued, the payment amount is fixed by that contract and backed by the general assets of the issuing charity. It does not fluctuate with markets. It also is not insured by any government agency, and the payments depend on the continued financial health of the organization that issued them. A small charity and a large university endowment carry meaningfully different risk on that point, which is worth asking about before you sign.
Why the Rate Is Not the Same Thing as a Return
A charitable gift annuity rate describes the annual payment as a percentage of what you transferred. It does not describe investment performance, and treating the two as equivalent is the most common error in this whole category.
Part of every payment you receive is your own principal coming back to you. That is by design. The ACGA builds its schedule around a target residuum, which is the amount expected to remain with the charity when the payments end, and that target has been 50% of the original contribution since 1955.
Read that again, because it reframes the advertising. The rate is calibrated so that roughly half of what you gave is expected to still be there for the charity after you are gone. You are making a gift that pays you back over time. You are not buying an investment that yields 7%.
The other assumptions behind the schedule are published as well. The ACGA uses a gross investment return expectation of 5.75% per year on annuity reserves, an expense assumption of 1.0%, and a resulting net compounding rate of 4.75%. Mortality comes from a blend of the 2012 Individual Annuity Reserving Table.
How Is Income From a Charitable Gift Annuity Taxed
Payments from a charitable gift annuity funded with cash split into two parts for tax purposes: a portion treated as ordinary income and a portion treated as a tax-free return of principal, spread across your life expectancy.
Funding the gift with appreciated stock adds a third layer. The capital gain attributable to the annuity portion is spread across the payment period as capital gain income rather than recognized all at once, and the gain attributable to the charitable portion is not recognized at all.
That split treatment is the real advantage over a commercial annuity, and it is the part charity pages tend to compress into a single line. It also carries an expiration. Once you outlive your life expectancy under the IRS tables, the tax-free portion is exhausted and the entire payment becomes ordinary income from that point forward.
You also receive a charitable deduction in the year of the gift, equal to what you transferred minus the present value of the payments the IRS expects you to receive. That calculation moves with the federal discount rate in effect, which is why two identical gifts made months apart can produce different deductions.
Can a QCD Fund a Charitable Gift Annuity
A qualified charitable distribution from an IRA can fund a charitable gift annuity through a one-time election, and it comes with a consequence that rarely appears in the marketing.
Payments from a gift annuity funded with IRA money are taxed entirely as ordinary income. The split treatment described above does not apply. The tax-free return of principal portion, which is the main reason a gift annuity is attractive in the first place, is gone.
That does not make the election a bad idea. For someone facing required distributions they do not need, converting a forced withdrawal into lifetime payments can be exactly right. It does mean the two versions of this gift are different products, and anyone comparing them should know which one they are being shown. Our guide to Bunching Charitable Donations in 2026 covers the election limits and how they interact with the annual cap.
Is a Charitable Gift Annuity a Good Idea
A charitable gift annuity is a good idea when you already intend to leave money to a specific organization and you would also like income while you are alive. It is a poor idea when you are shopping for yield.
The distinction is the whole decision, and it turns on one question: would you have given to this charity anyway?
If yes, the arrangement is efficient. You accelerate a gift you were going to make, you receive a deduction now, and you get payments for life. If no, you are handing over an irrevocable transfer in exchange for a rate you could likely match or beat elsewhere without giving away the principal.
Three things make a gift annuity the wrong fit:
- You may need the principal back. The transfer is irrevocable from the day it is made. A commercial annuity has a surrender schedule that eventually reaches zero, as our guide to Annuity Surrender Charges Explained covers. A gift annuity has no such schedule, because there is nothing to surrender.
- You want the payments to grow. They are fixed for life, so inflation erodes them the entire way.
- You have no charitable intent. Roughly half the gift is expected to stay with the charity. If that outcome does not appeal to you, the math never will either.
How a Gift Annuity Compares With Other Lifetime Income
A commercial annuity buys income and returns nothing to charity. A gift annuity buys income at a lower rate and directs the remainder to an organization you chose. A donor-advised fund gives you a deduction and a say in the grants but pays you nothing.
Which one belongs in a plan depends on what you are solving for. If lifetime income is the objective and charity is secondary, the comparison should start with the full range of income for life options and treat the gift annuity as one candidate among several. If the gift is the objective and income is a welcome side effect, the ordering reverses.
Both readings are legitimate. What causes trouble is arriving at a charity’s website with the first objective and being sold the second.
Frequently Asked Questions
What Are the Best Charitable Gift Annuities for Seniors
Since nearly all charities use the same published rate schedule, the rate is rarely what separates one from another. What separates them is the financial strength of the issuing organization, whether it follows the ACGA schedule or pays below it, and whether you actually care about its mission.
Can I Fund a Gift Annuity With Appreciated Stock
Yes, and it is often the better funding asset. You avoid recognizing the capital gain on the charitable portion, and the gain on the annuity portion is spread across the payment period rather than taxed in one year.
Do Rates Change Every Year
They change when the ACGA board decides economic conditions warrant it, which is not annual. The current schedule has been in place since January 2024.
What Happens if the Charity Runs Into Trouble
Payments are backed by the general assets of the issuing charity rather than by a segregated account or a government guarantee. Several states regulate gift annuity issuers and impose reserve and asset requirements, and Arizona families should ask which state’s rules apply to the organization they are considering.
Is There a Minimum Age or Gift Amount
Most charities set their own minimums, commonly by both age and dollar amount. The ACGA schedule itself extends to much younger ages, but the rates at those ages are suppressed by a separate requirement designed to protect the charity’s eventual remainder.
How We Look at Gift Annuities at Global Investment Strategies
We start with the plan rather than the product. That means looking at where your income is already coming from, what your required distributions look like, what you have earmarked for charity, and what your estate documents already say.
A gift annuity fits cleanly when those four things point the same direction. Global Investment Strategies has worked with Tucson families since 2009, alongside their attorneys and CPAs, and the useful conversation is usually about sequencing rather than about which charity offers what.
You can read more about how we approach charitable gift annuities and where they fit a broader plan. The current rate schedule and every assumption behind it are published by the American Council on Gift Annuities.
Run the Numbers Before You Sign Anything Irrevocable
A gift annuity is a permanent decision made from a brochure written by the recipient. That is not a reason to avoid it. It is a reason to look at it alongside everything else you own before the paperwork goes in.
We work with families across Tucson, Oro Valley, Marana, and the Catalina Foothills who are weighing exactly this. Request a private conversation and we will look at where a gift annuity fits in your income plan, and where it does not.
Global Investment Strategies provides educational planning concepts and works alongside your qualified legal, tax, and financial professionals. This article is educational and is not individualized tax, legal, or financial advice. Rates and tax rules described here reflect the schedule effective 1 January 2024 and federal and Arizona law as of 2026, and both change over time. Review any charitable gift annuity with your attorney and CPA, and with the issuing charity, before acting.
