Joan Stoner, CPA

Most people think that giving to a charity involves cash, but a gift of real estate can be stretched to have many more benefits than a outright cash gift. Several different ways of giving can provide on-going benefits to the donor and the charity.

If the donor wants to maintain control of the property, a limited partnership can be set up where the charity is the limited partner. The donor then gifts a percentage ownership in the real estate to the charity. The donor would received a donation deduction equal to the fair market value of the interest.

More often used in the donation of real estate is a charitable trust, either a charitable remainder trust or a charitable lead trust. A charitable remainder trust gives the income stream from the property to the donor for their life time. The charity receives the property only after the death of the donor. A charitable lead trust gives the income stream from the property to the charity for a stated length of time. The remainder can then be returned to the donor, their children or grandchildren or any other beneficiary. The deduction to the donor is more limited than outright gift but the benefit can still be large.