Prepared for: Donor name
| A. Input Assumptions | |||
|---|---|---|---|
| Date of transfer | January 21, 2020 | ||
| Fair market value of property transferred | $100,000.00 | ||
| Nearest age on the date of the gift for Beneficiary 1 is | 92 | ||
| Nearest age on the date of the gift for Beneficiary 2 is | 87 | ||
| Date of first payment | March 31, 2020 | ||
| Annual annuity rate for immediate annuity | 8.5% | ||
| Payment frequency | Quarterly | ||
| Prorate first payment or Full first payment? | Prorate | ||
| Is payment at the beginning or end of the payment period? | End | ||
| The discount rate (effective 1/2020) is | 2% | ||
| The mortality table is based on the census taken in year | 2000 | ||
| B. Present Value of Remainder Interest - Immediate | ||
|---|---|---|
| 1. | Net fair market value paid for annuity | $100,000.00 |
| 2. | Annual annuity rate | 8.5% |
| 3. | Annuity amount payable on an annual basis | $8,500.00 |
| 4. | Factor for present worth of a single life annuity (based on table S) | 6.1245 |
| 5. | Adjustment factor based on payment frequency from Pub. 1457, Table K | 1.0075 |
| 6. | Adjusted value of $1.00 (Line 4 * Line 5) | 6.1704 |
| 7. | Adjusted annuity value (Line 3 * Line 6) | $52,448.40 |
| 8. | Excess of actual 1st payment over pro rata 1st payment (0 for pro rata first payment) |
$0.00 |
| 9. | Present value of annuity (Line 7 + Line 8) | $52,448.40 |
| 10. | Minimum value of annuity (lesser of line 1 and line 9) | $52,448.40 |
| 11. | Present value of remainder interest (Line 1 - Line 10) | $47,551.60 |
Depending on the type of asset you contribute, a portion of your payment may be taxable to you as a combination of ordinary income, long-term capital gain, and a tax-free return of principal. This report has been calculated assuming a contribution of cash. Each of your next 7.4 years payments of $8,500.00 will contain $7,087.62 of tax-free income and $1,412.38 of ordinary income. All income will be ordinary after 7.4 years.
NOTE: This calculation is provided for educational purposes only. The type of assets transferred, the actual date of the gift, and other factors may have a material effect on the amount or use of your deduction. You are advised to seek the advice of your tax advisors before implementing a gift of this type.
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