Gifts of Real Estate
Charitable Bargain Sales
With the Charitable Bargain Sale, you sell your residence or other property to SLUH at less than its fair market value. The transaction gives you cash that you can use to purchase your next home or as the entry fee for a retirement facility, plus a charitable income tax deduction for the discount you took from the market value.
We mutually agree on the purchase price for your property, and on whether we will pay you in a lump sum or through an installment note.
The bargain sale is the only gift plan that can:
- give you both a lump sum of cash, and
- a charitable deduction.
How it works
You sell your residence or other property to for a price substantially below the appraised market value, resulting in a transaction that is part charitable gift and part sale.
usually elects to sell the property and uses the net proceeds of sale for the purpose or purposes you specify.
Benefits
- You receive an immediate income tax deduction for the appraised market value of the portion of the property you donated.
- You pay no capital gains tax on the donated portion of the property.
- You can receive cash from the sale portion to retire a mortgage or for other purposes.
- You can have the satisfaction of making a significant gift to during your lifetime.
Retained Life Estates
Another attractive gift plan for real estate is the retained life estate: you give SLUH your home, then continue to live there for the rest of your life. We will own the house, but you will continue to be responsible for its ongoing taxes, structural maintenance, and upkeep. And, we mutually agree upfront about what we will do if you no longer wish to live in the house, or become physically unable to continue living there.
You will receive a charitable deduction based on the fair market value of your home minus the present value of the life tenancy you have retained.
With a retained life estate, you make a significant gift to SLUH with the most valuable asset you hold, without disturbing your income or your living arrangements.
How it works
You transfer your residence, farm, or vacation home to subject to a life estate.
You continue to live in the property for life or a specified term of years, while continuing to be responsible for all taxes and upkeep.
The property passes to when your life estate ends.
Benefits
- You receive gift credit and an immediate income tax deduction for a portion of the appraised value of your property.
- You can terminate your life estate at any time and take an additional income tax deduction.
- You can have the satisfaction of making a significant gift now that benefits later.
This gift is for you if...
- Your home, or a piece of investment property, is your most significant asset;
- Choose a retained life estate if you want to stay in your home, are able to continue maintaining it; and are seeking a tax deduction rather than a stream of income from your gift;
- Choose a charitable bargain sale if you want to dispose of your home, need some of its value for your next purchase, but want to reduce your capital gains liability and secure a tax deduction through a gift;
- You can also use a charitable bargain sale to transfer commercial property, or a non real-estate asset, to us.
To learn more about gifts of real estate, E-mail us, complete the Information Request form, or call us at 314.531.0330 so that we can assist you.
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