Almost any type of real estate may be donated: undeveloped land, farms, commercial buildings, vacation homes, or your residence.
Outright Gift of Real Estate
You receive a charitable income-tax deduction for the full fair-market value of any unencumbered real estate you give to the Lewis County Historical Society. You may apply the deduction up to 30% of your adjusted gross income—in the year of the gift—with the five-year carryover provision. You avoid capital-gain tax on the appreciation you have in the property, and there are no gift taxes. Because you have removed the property from your estate, you may also reduce your estate taxes.
How It Works
- You transfer title to the property to the Historical Society
- You receive an income-tax deduction for the full fair-market value of the property
- The Historical Society may use or sell the property
- Income-tax deduction for fair market value of property based on qualified appraisal
- Avoid capital-gain tax on appreciation in value of real estate
- You are relieved of details of selling property
- The Historical Society receives a significant gift
Gift of Personal Residence or Farm With Retained Life Estate
You may give the property to the Lewis County Historical Society while retaining the right to occupy the residence or operate the farm. Such a gift of a remainder interest provides a charitable income-tax deduction for the present value of the remainder interest that frees up tax dollars into spendable income—without causing any disruption in your lifestyle. In addition, this plan permits you to escape any potential capital-gain tax on the built-in appreciation.
Example: Mary, 75 and recently widowed, has lived in her home for 55 years and has no plans to move. To obtain present tax relief without altering her lifestyle, she gives her home to the Historical Society while retaining the right to live in the home for life.
At the time of the gift, the residence is appraised at $250,000. This gift arrangement will provide a charitable income-tax deduction of more than $179,000 (the value of the charity’s remainder interest). Since Mary’s tax bracket is 24%, her total tax savings will be almost $43,000 (24% of $179,000). This is the amount by which her income tax will be reduced over the period she reports the deduction.
In the event she decides to move, she will have several options: rent the property, give her life interest in the home to the Historical Society in exchange for a stream of payments for life, or simply give her life interest outright and receive another deduction.
How It Works
- Transfer title to personal residence or farm to the Historical Society
- No change in your lifestyle – you (and spouse) occupy and enjoy residence or farm for life
- The Historical Society keeps or sells property after your death(s)
- No out-of-pocket cost for substantial gift to the Historical Society
- Federal income-tax deduction for remainder value of your residence or your farm
- You and spouse can occupy residence for life