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| When a Gift of Real Estate Makes Sense Heyward Carter, Jr. Evans, Carter, Kunes and Bennett, P.A. Why would someone give real estate to CCF? Some people have more land than cash, and there are advantages to the owner who decides to give real estate to CCF. What are those advantages? A donor may generally deduct the full market value of the real estate. Normally, no taxes will be incurred unless the donor’s debt on the property is greater than his or her basis for tax purposes. If the property is to be sold after it is received by CCF (which is generally the case), it should be given to CCF before a sales contract is signed in order to avoid having the IRS deem the donor, instead of CCF, to be the seller. The procedure is, therefore, somewhat time sensitive and must be handled carefully. What about a gift of appreciated real estate? The donor can deduct the appreciated value of the gift if the property has been held "long term". Certain rules apply as to the amount of the deduction which can be taken in the year of the gift. What kinds of properties are particularly appropriate for a gift to CCF? Ideal properties are those which are non-commercial, are not mortgaged, can be expected to be sold reasonably soon after they are received by CCF, and are environmentally "clean". What about a residence? There is a special provision in the Internal Revenue Code (Section 170(f)(3)(B)(i)) which allows a donor to give a "remainder interest" in a personal residence or farm to a charitable organization and receive an income tax deduction for the computed value of that remainder interest. The donor can continue to live in the residence or on the farm for life, with the property passing to the charity after he or she dies. This special rule is available only for personal residences and farms. (A "remainder interest" is normally ownership of the property after the donor (who has the "life interest") dies.) What is the first step? Call the staff at CCF to make an appointment to discuss a possible gift. Whether or not you decide to establish a fund, they will be happy to explain the process to you. You might also discover a way to give through a charitable trust or some other form of estate planning. Don't forget that a cash gift is always welcome, too. (And always consult with your own tax or legal advisor!) Heyward Carter has been CCF’s Legal Counsel and a generous and loyal friend for many years. |
 Ways to Give: Charitable Funds Charitable Assets Charitable Instruments Related Content: Policy for Trusteeship of CRTs (PDF) Alternatives to Private Foundations (PDF) Checklist for Real Estate (PDF) Corporations and CCF (PDF) Field of Interest Fund Sample Agreement (PDF) Donor Advised Fund Guidelines (PDF) Sample Language for Bequests (PDF) Investment Performance and Policy (PDF) Total Return Concept (PDF) Policy for Life Insurance Gifts (PDF) Policy for Accepting Gifts of Real Estate (PDF) Designated Fund Sample Agreeement (PDF) Partially Endowed Fund Sample Agreement (PDF) Corporate Alternatives to a Private Foundation (PDF) Donor Fundraising Guidelines (PDF) |