We follow the payout schedule established by the ACGA, in order to be assured that we are in compliance with various state and federal regulations, and that we will be able to meet the obligations we have to our annuitants. The full assets of the National Heritage Foundation, Inc. must back all of the Charitable Gift Annuities, by government regulations. Inc. Each of the United States, with a few exceptions, has established rules and regulations regarding charitable gift annuities. The regulations pertain to the amount of reserve requirements that must be maintained. They also require certain levels of reporting in regard to the gift annuities issued by the charity.
Some states have more strict regulations than others.
We have decided to abide by the regulations of the strictest states where we issue charitable gift annuities, thereby far exceeding the requirements of all of the others. This requires an actuarial calculation at the time of establishing the charitable gift annuity agreement. The rules permit the charity to employ any surplus over this required reserve for general operations of the charity, including development expenses. This is the most conservative position we can take, considering the regulations. The Internal Revenue Service, in defining a charitable gift annuity, says that, among other things, the charitable gift annuity is a split gift.