Your payments are not counted as income in determining social security payments. Once the annuity payments have ceased, CARE applies the gift to programs providing food, training and other aid to people throughout the developing world, both long-term and on an emergency basis. Example Stuart and Doris Voight, both age 74, are longtime CARE contributors. Mr. Voight has recently retired. Once it is determined, the gift annuity rate will not change.
Payments represent both interest and a return of principal.
The portion of the principal returned with each payment accounts for the tax-free part of the annuity payment. In addition, all of CARE's unencumbered assets stand behind every payment. You can choose to receive payments once, twice or four times a year. You avoid capital gains tax on that part of the property that is considered a gift. Realized capital gains can be reported over your life expectancy if you are both the donor and the annuitant.