Real estate is one of the most widely-held assets—a personal residence, mountain cottage, beach home, vacation condo, commercial buildings or land. It’s a logical choice for many who wish to make a donation to the HudsonAlpha Foundation.

Deeding just a remainder interest to the HudsonAlpha Foundation. One of the best ways to generate a large, current income tax charitable deduction—while still retaining complete control and custody of your real estate during your lifetime—is to deed a remainder trust to the HudsonAlpha Foundation in your personal residence, vacation home or other real estate. For more information on this type of giving, please contact one of the Foundation members at the links indicated.

Charitable deduction

For federal income tax purposes, the value of your charitable deduction for a gift of real estate is the full fair market value of that real estate on the date it is gifted. You must have owned the property for more than one year.

Avoids Capital Gains Tax

If the fair market value of gifted real estate is greater than your cost basis in that real estate, then by gifting it to the HudsonAlpha Foundation you also avoid capital gains tax that would have been levied against such increase in value had you sold the real estate yourself and realized that gain. Estate tax savings as well as avoiding probate are other possible benefits.

Deductibility

Gifts of real estate held for more than one year are deductible up to 30% of your federal adjusted gross income for the year. If your gift exceeds that 30 percent, then you may deduct the excess over the following five years, again up to 30 percent of your adjusted gross income for each carry-over year.

Appraisal requirements

If the value of your charitable deduction for your gift of real estate is greater than $500, your income tax return must be accompanied by a completed federal Form 8283/Noncash Charitable Contributions detailing your gift of real estate. If the value of such charitable contribution is greater than $5,000, you must obtain an independent qualified appraisal of your gifted real estate to accompany your Form 8283 in order to substantiate your income tax deduction — we’ll help you get one.

For more information, contact advancement@hudsonalpha.org.