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The Metamor Model: How it Works
A 70 year old male donor makes a $250,000 Charitable Gift Annuity Donation to your organization. Here is how the Metamor Model works:
- A Donation is made by the donor to your charity ($250,000) in exchange for an agreed upon annuity payment schedule ($3,812/quarter for life). The donor receives a tax deduction ($99,700) in the year the gift is made, based on current industry guidelines and standards set by the ACGA.
- A call is made to Metamor Charitable Funding to broker a commercial income annuity on behalf of your charity with a portion of the total donation ($178,000), to fund your quarterly obligation to the donor. The balance ($72,000) is retained by your organization for immediate use as agreed upon with the donor.
- The Life Insurance Company makes the annuity payments ($3,812/quarter) to your charity, based on the agreed upon annuity agreement you have with your donor. Your organization deposits the check and sends a charity issued check to the donor based on their payment schedule. You can elect to have the Life Insurance Company send the check directly to the donor for administrative convenience if you so desire. ($9,455 of the annual $15,250 annuity is paid in a tax free form to the donor each year. $5,795 of the annual amount is considered ordinary income by the donor and subject to tax liability.)
- Upon the death of the donor, a Legacy Refund, (equivalent to the difference between the premium paid to the Life Insurance Company and the benefits paid back over the lifetime of the donor) is paid to your organization in the form of a single lump sum. ($178,000 premium - $122,000 benefits paid out = $56,000 paid as a single lump sum to charity.)
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Using the Metamor Charitable Funding model, your organization realized $128,000 of the corpus $250,000 donation!!! Most important, more than half of those proceeds were put to immediate mission driven services upon the gift being made, with a secured creditor making the promised annuity payments through the purchase of the commercial income annuity.
$250,000 donation to your organization
-$178,000 premium to fund annuity promise with donor
$72,000 available for immediate mission driven services
$178,000 initial premium paid to fund annuity promise
-$122,000 benefits paid to your donor over his lifetime
$56,000 paid in a single lump sum to your organization upon the passing of your donor as a Legacy Refund - available for future mission driven services.
$72,000 now
+$56,000 in the future
$128,000 of the donation is made available to your charity for mission driven services - all with no stress!
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