The gift annuity agreement provides donors who give cash, securities, real estate or personal property fixed annual payments for a specified period of time, usually for life. With a deferred gift annuity, the annual payments do not start when you make the gift, but begin at a later time specified by you.
Gift annuities are attractive if you want to receive income from assets that have risen sharply in value, such as cash or stocks. In return for gifts of such assets, you are guaranteed a fixed annual income for the rest of your live and you avoid capital gains tax. You also get an income tax break on a portion of the earnings from an annuity; the exact amount depends on your age.
updated: May 21, 2013