New York state lawmakers have approved a bil that could help clients there make more use of charitable gift annuities.
Members of the state Assembly recently voted 145-0 to pass 02683 and send it on to Gov. Kathy Hochul for her signature. The state Senate passed the bill by a 60-1 vote in May.
The bill would change state rules, adopted in 2020, that regulate how charities in the state set charitable gift annuity payout rates.
The American Council on Gift Annuities has been lobbying to change the rules, arguing that they lower the rates New York state charities can offer on gift annuities and hurt the charities' ability to compete with charities in other states.
What It Means
Charities based in New York state may soon be able to pay your clients more attractive rates on gift annuities.
Charitable Gift Annuities
A client who wants a charitable gift annuity makes a large payment to a charity. The charity then sends regular payments to the donor and keeps any assets left over when the donor dies.
The gift annuities council has recommended that issuers set the payout rates to make the amount left over, or "target residuum," equal to about 50% of the original gift amount.
