Anyone Ever Donate Property to Charity?

Question

In this challenging market for sellers, I was wondering if anyone had any experience donating investment property to charity 501(c)(3).

It seems like a good way to dispose of property that may not be selling.  Thoughts?

James Wootton · Answer

Hello @Rob Gillespie and @Joshua Dorkin It is not necessary to have a basis in real estate to have a tax deduction for donating real estate to charity if you have owned it for more than one year.  Your deduction would be equal to its fair market value (FMV) as determined by an independent qualified appraiser.  If you sell it to the charity for less than its FMV, then you are entitled to a deduction for the difference between the FMV and the price that the charity pays you. IRS calls this a "Bargain Sale" and it is perfectly legitimate if you follow the rules.  The appraisal must be performed not less than 60 days prior to closing (not stale), but not later than the due date of your next IRS return, usually April 15 of the following year. You must file form 8283 which details your basis - even if it is zero; the appraised value, any price received from the charity, and therefore the amount deducted. The form 8283 is to be signed by all three - the donor, the appraiser, and the charity.  If the property is resold within 3 years, the charity is to report the resale price to IRS on form 8282. Let me know if there are any further questions on gifts or partial gifts of real estate.

Jim Wootton

Trustee of American Community Fund

Account Closed · Answer

There are a few houses I thouht about donating to the fire department for practice!!    :lol:

Richard Warren · Answer

When I was a financial planner I worked with several people who donated stocks and real estate through the use of a charitable remainder trust (CRT). They create the trust and transfer the property to it. They can then sell the property and avoid capital gains tax. They reinvest the proceeds into an income producing vehicle and receive the interest income from it. When they die the property goes to the charity. They also receive a tax deduction based on their life expectancy, the amount donated and the rate of interest that they receive.

What are you trying to accomplish by donating the property?

8)

What are you trying to accomplish by donating the property?

8)

Andrew Canales · Answer

There are HUGE benefits that comes with donating real estate to a nonprofit. Even selling it at a discount through what the IRS calls a "Bargain Sale."

If you sold a house to a nonprofit at a discount, then you are entitled to a deduction for the difference between the FMV and the price that the charity pays you...AND, you can spread the deduction over 5 years!

Houses for Warriors, Inc. is a tax-exempt 501c3 nonprofit and in need of real estate donations. All types of real estate welcome, any condition.

We have partnered with Chase Magnuson, an expert RE donations facilitator who co-wrote the book: The Secret Power Behind Real Estate Donations and has over 30 years experience facilitating donations. He will be helping our Organization facilitate all real estate donations and "Bargain Sales" to houses for warriors.

We are in dire need of homes across the US to house homeless and injured Veterans of the Iraq and Afghanistan Conflicts. We currently have over 1 million homeless (or at-risk) veterans in the United States.

We specialize in Rehabing distressed properties into VA Approved homes to sell to our VA Buyers. Profits are used to acquire more properties to house homeless veterans and to build adaptive improvements for severely injured warriors.

Loriann Macli · Answer

I am a new 501c Rescue group looking to for property. Any tips on getting people to donate property?

Steven Hamilton II · Answer

James is correct. It can be a big benefit.

Rob Gillespie · Answer

We were gonna donate a 20 unit building one time, but ended up selling it for a few grand to the charity. It was not gonna benefit us for our taxes because we did not have a basis in it. It was one of those beat up free bees!!

Savannah Leigh · Answer

I have a similar problem, except this one has a REALLY ROUGH house on it.  Unable to sell it, not sure I want to throw the $50k at it that it's worth.

My city will take it as a donation, but my accountant says all I can write off is the costs My company has in it.  If I buy the house personally (from my company) can I get more of a write off.

If anyone wants a good 3 family that needs EVERYTHING in Wilkes-Barre, first $10,000 takes it!

Michael Shadow · Answer

what about donating to habitat for humanity?

Anyone Ever Donate Property to Charity?

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