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Real Estate
- Tax-deductible in the year
given
- Avoids capital gains tax
- Relieves donor of future
property taxes
Many people own real estate
that has increased in value since the time it was originally
purchased. When the property is sold, the federal government
taxes the gain. If the real estate isn’t used as a
primary residence, it doesn’t qualify for the one-time
exemption from capital gains for people over the age of
55. However, by donating the property to Brewton-Parker
College, the donor can avoid capital gains taxes.
If the real estate has
increased in value
A gift of real estate
can benefit the donor in three ways.
- The donor will receive a
tax deduction for the full value of the property, not
just the purchase price.
- The donor avoids capital
gains tax because the property was given rather than sold.
- The donor is relieved of
future property taxes and expenses for maintaining the
property.
If the real estate has
decreased in value
If the real estate has decreased
in value since it was purchased, the donor can sell the
property and realize a loss on the sale. The loss may be
used to offset future gain and reduce taxes. The cash proceeds
can be given to Brewton-Parker College, which will give
a tax deduction equal to the gift amount.
Charitable Remainder Trust
If the donor needs the income
from the real estate, the gift may be used to fund a charitable
remainder trust. Income from the investment of the proceeds
from the property sale can provide income to the donor or
beneficiary.
- The donor avoids capital
gains tax.
- The donor receives a tax
deduction for the gift portion as determined by life expectancy
and government tables.
Irrevocable Life Estate
If the donor wants to retain
the right to live on the property, it can be given to Brewton-Parker
College as an irrevocable Life Estate. The property must
be a residence, vacation home or a farm, but not rental
property.
- The donor receives a tax
deduction for the eventual value of the gift.
- The donor retains the rights
and responsibilities of the property owner throughout
his lifetime.
Please
feel free to contact us if you need assistance by calling
toll-free 1-800-342-1087, ext. 255 or e-mailing one of the
members from our department.
Brewton-Parker College #2014
Office of College Advancement
P.O. Box 197
Mt. Vernon, Georgia 30445
Doug Baird, Vice-President for College Advancement
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