February eRate

Thou Shalt Not Alter Thy Gift Annuity Agreements

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This question comes up from time to time: can the non-profit organization that is sponsoring charitable gift annuities modify its templates for the gift annuity agreements? Sometimes a person at the sponsoring charity wants to change portions of the agreements from an aesthetic standpoint – they want the language to be more flowing, or they have unique terminology they would like to be incorporated into the agreements. In other situations, there is concern about the technical aspects of the agreements – perhaps a consultant or some other outside advisor thinks the terms should be stated differently.

Whatever interest there is – however well-intended – behind the idea of modifying the gift annuity agreement templates, our general recommendation is NO! – don’t do it – don’t even think about doing it, except, of course, on the advice of your legal counsel. Let’s discuss some of the reasons why.

WEBINAR January 26

Asking Your Donor for Their Largest Gift Ever: A Bequest

Did you know most people give a larger gift to their favorite charity through their estate than all their lifetime gifts to that charity combined? Many fundraisers fear a bequest conversation means talking about death, dying, and cutting the kids out of an inheritance. Who wants to do that? In this webinar, Anne Melvin, Senior Learning Consultant to Harvard University’s central fundraising operation, will help you reframe your understanding of the bequest ask, learn ways to talk about bequests, and arm you with the kind of knowledge that will help you make the bequest discussion a positive, life-affirming experience.

Presented by
Anne T. Melvin, J.D.

Thursday,
January 26, 2023
1:00 - 2:00 pm ET

UPCOMING TRAINING

PGM to PGM Anywhere FREE

February 2, Online (90 minutes)

PGM Anywhere and Charitable Remainder Trusts

February 8-9, Online (4 hours over 2 days)

PGM Anywhere Introductory and Advanced

Introductory: February 14, New York, NY (in person, 9:00 am - 4:00 pm ET)
Advanced: February 15, New York, NY (in person, 9:00 am - 4:00 pm ET)

Lead Trust School

March 1-2, Online (6 hours over 2 days)

GiftWrap Quick Tip: Printing 1099-R Tax Forms

As many GiftWrap clients focus on preparing 1099-R tax forms for their gift annuitants this month, we offer a few tips to help avoid the most common problems when printing onto pre-printed forms.

Data Doesn't Fit Forms Correctly

Simply put, this issue arises because GiftWrap produces the 1099-R information in the exact size required to fit data into the boxes on the pre-printed 1099-R forms. However, many printers and some browsers automatically resize before printing. This error is so common that selecting Print will produce the following message, reminding you not to scale.

You can identify the resizing issue because the data will typically print a little too low relative to the boxes on the top half of the 1099-R form and too high on the bottom half. The trick is to configure your printer to print the GiftWrap data without any scaling adjustment.

In the Print Dialog window, look for the setting that controls sizing. Printer drivers use different terms, but you want “Page Scaling” set to “None” or “Actual Size.” In Chrome, there is a checkbox labeled “Fit to page” and this box must be unchecked.

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Use Correct PDF Format

When printing forms, always make sure the Display Option at the bottom of the 1099-R form in GiftWrap is set to PDF, not Report Viewer. If you do choose Report Viewer, then you must choose the printer icon in the report viewer to generate the PDF version of the report for printing.

If you are running GiftWrap in Firefox, check the settings under Tools – Options – Applications. In the Content Type column on the left, find “Portable Document Format (PDF)” and make sure it is set to “Use Adobe Acrobat (in Firefox).” If this is set to any other value, the printing alignment will be off.

Choose the Correct Form

Select the appropriate Form (A or B/C) from the dropdown list to match the pre-printed forms you are using. If you select Copy B/C and print onto form A, the name and address will not format correctly in the boxes.

Blank Perforated Forms

Printing the entire form onto blank perforated forms avoids issues with fitting data into boxes. This is a good option for small numbers of 1099-Rs, but be aware that printing the full form plus data onto blank perforated forms is a much slower print job.

Last Resorts

If our tips don’t solve the issue, try a different printer. If that doesn’t work, send a scan of the offending form to support@pgcalc.com and we’ll call you back, or call Client Services at 888-474-2252.

From the Blog: Legacy IRA Act Becomes Law

In the final hours of the 117th Congress, provisions of the Legacy IRA Act included in an omnibus spending bill (the Consolidated Appropriations Act, 2023 or H.R. 2617) passed the House and Senate and were signed into law by President Biden, creating a new charitable gift planning opportunity. Beginning in 2023, donors over age 70 ½ will be able to make a Qualified Charitable Distribution (QCD) in exchange for a charitable gift annuity (CGA) or to fund a charitable remainder annuity trust or charitable remainder unitrust. For practical purposes, it is unlikely donors will use this opportunity to fund a charitable remainder trust. However, a charitable gift annuity could be an appealing and viable option for some donors.

Read the blog post . . .

Free Webinar Recording: What You Need to Know About the New Legacy

As of January 1, donors can now use a qualified charitable distribution (QCD) from their IRA to fund a gift annuity or charitable remainder trust. Last Thursday, Kara Morin, PG Calc Director of Client Services, discussed the requirements and limitations that apply to the new QCD options. Along with our team of experts, she also shared our answers to the many practical questions our clients are asking us and reviewed other changes in the new law that likely will affect the size and timing of some QCD gifts.

You can view the recording of our free webinar as well as Kara's slides. We have also created an FAQ about the tax law changes in the PG Calc Knowledge Base.

If you have questions about the impact of the new tax laws on planned giving, you can contact Client Services at 888-474-2252 or support@pgcalc.com. If you would like to discuss how best to use this opportunity to market to your donors, call us at 888-497-4970 or info@pgcalc.com, and we can schedule a conversation with Andrew Palmer, PG Calc‘s Director of Marketing Services.

PGM Anywhere and PGM Desktop Updated with New ACGA Rates, Effective January 1

On December 19, we sent an email to all PGM Anywhere and PGM desktop users to let them know we had updated these applications with the new maximum annuity rates suggested by the American Council on Gift Annuities (ACGA). The new ACGA rate became effective on January 1st. One-life rates are generally 0.7%-0.8% higher, and two-life rates are generally 0.4%-0.8% higher than the rates they replace.

While at it, we also added the indexed federal tax tables for 2023. In the case of PGM Anywhere, the only tax table affected was the federal income tax table for estates and trusts, which is used to compute lead trust income taxes. In PGM desktop, we updated federal tax tables used to compute federal income tax for non-grantor lead trusts and federal gift, estate, and generation-skipping tax, where applicable, in testamentary, estate plan, and lead trust models.

Detailed PGM Anywhere release notes are available from a link on the PGM Anywhere login screen. A detailed summary of changes in PGM desktop are available from a link on the PGM 7.6A download page.

Contact PG Calc Client Services at support@pgcalc.com or 888-474-2252 if you have any questions about these updates.

Most New York Maximum Annuity Rates Remain Higher than ACGA Rates in Q1 2023

For the third quarter in a row, there is good news for charities that issue annuities in New York. New York’s published maximum one-life annuity rates for Q1 2023 remain higher than the corresponding ACGA rates for all male and female ages.

To date, New York has not published any guidance on rates to use for two-life immediate, or one-life or two-life deferred annuities. PG Calc has worked with an actuary to determine how to perform these calculations.

Our testing of a range of ages suggests that the ACGA’s two-life immediate annuity rates will also qualify. Charities may therefore feel confident proceeding with the ACGA rates for both one-life and two-life immediate annuities.

In addition, the results of our analysis of deferred one-life annuities indicate they will also qualify. Using a range of ages and deferral periods, the ACGA continues to duck under the New York maximum rates, if only by a handful of basis points.

For two-life deferred annuities, however, the results vary. Some pairings of ages and deferral periods qualify, but there are many two-life deferred annuity scenarios where New York’s maximum rate is lower than the ACGA rate.

If you are working with a New York donor who wishes to fund a one-life or two-life deferred gift annuity, please contact us, and we will determine the maximum annuity rate New York will allow you to offer your donor. Learn more about our New York Rate Calculations Service and submit a calculation request form. This service is free to PG Calc customers.

Contact PG Calc Client Services at support@pgcalc.com or 888-474-2252 if you have any questions.

Register for Any or All of the PG Calc 2023 Webinars

We have an exciting line-up of monthly webinars scheduled for this year. We hope you will join us for some or all of them!

See the 2023 schedule of webinar topics. When you see a webinar you want to attend, click the webinar title, then click the Register Now button. To register for the whole series - just $270! – click any webinar that doesn’t have “Q&A Webinar (FREE)” in the title, then click Register Now and select one of the “2023 Series” purchase options.

Eight of the webinars will include a 45-minute formal presentation followed by a 15-minute Q&A period. Each one costs just $45 for the first registration and $25 for each additional registration. The other four are free “Q&A Webinars” where you can ask an expert your questions on the designated topic. Whether paid or free, all registrants will receive a replay of the webinar that is good for 60 days.

Live from New York, It's PG Calc Training

Register now for our upcoming Planned Giving Manager (PGM) and PGM Anywhere training in New York City on February 14-15. It’s a great opportunity to develop your planned giving knowledge and software skills. After a day or two of hands-on training with our experienced instructor, you'll be on your way to closing more gifts! This class will be taught using web-based PGM Anywhere and PGM desktop.

Introductory Session
Tuesday, February 14

Learn how to use PGM Anywhere to create persuasive gift proposals. This session will use case studies to introduce planned giving concepts, and will cover immediate and deferred gift annuities, remainder trust basics, and more.

Advanced Session
Wednesday, February 15

Discover advanced gift vehicles, including flip trusts, retained life estates, charitable lead trusts, and gifts of retirement plans using the flexible functionality of Planned Giving Manager and PGM Anywhere.

New College Foundation Appreciates the Responsiveness of PG Calc’s Marketing Services

“We are very happy with the Marketing Services provided by PG Calc. They have always been super responsive, and the level of customer service experienced working with your team and Kendra, in particular, has been outstanding.”

—Declan J. Sheehy
Director of Philanthropy
New College Foundation

Learn more about the New College Foundation.

Learn more about PG Calc’s Marketing Services.

PG Calc 129 Mount Auburn Street Cambridge MA United States

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