Gifts of real estate provide many of the same benefits as other assets: charitable deductions, capital gain avoidance, gift and estate tax reductions, diversification, lifetime income with professional management, and the opportunity to reach your charitable goals. However, an important additional benefit of giving real estate to The Kennedy Center is the opportunity to consider and implement a divestiture strategy without undue pressure, expense and anxiety.
Here are some reasons to consider a gift of real estate:
- You would like to make a gift to The Kennedy Center while retaining your cash and liquid assets.
- You are discouraged from selling appreciated property because of substantial capital gains tax liability and/or the decision of how to invest the proceeds.
- You own a rental or commercial property that has become a management issue.
- You are considering moving to a smaller home, retirement complex or closer to children.
- You are no longer using vacation property as in the past and are considering selling.
- You would like to convert annual outlays for maintenance and taxes into a lifelong income from your property.
- You recognize the illiquidity of real estate and would like to avoid problems associated with forced sales, multi-state property holdings and loss of control.
What are the most common ways to make a gift of real estate?
- An outright gift can be made of a partial or entire interest in a real estate holding. This is accomplished through the creation of a new deed reflecting The Kennedy Center’s ownership of all or a portion of the real estate.
- Make a gift of real estate while retaining the right to use the property for life, (Retained Life Estate). Give your residence, vacation home or farm to The Kennedy Center and continue to use it during your and your spouse’s lifetimes – yet earn a tax deduction now for the gift.
- Receive a lifetime income by giving your real estate to a charitable remainder trust or charitable gift annuity. Transfer a partial or entire interest via deed to a charitable life income vehicle and receive income payments for life for you, your spouse, or other beneficiaries.
- You can sell your real estate to The Kennedy Center for a price below its market value and receive both cash and a charitable tax deduction for the forgone value in the property.
- You can give property to The Kennedy Center through a bequest in your will, receiving an estate tax charitable deduction and relieving your executor of the illiquidity and tactical issues associated with real estate.
- If you have income producing property that you would like to pass to heirs, you could transfer the property to a charitable lead trust for a period of years after which the property reverts to your heirs with little or no gift or estate taxes.
We recommend that you consult your tax advisor to determine additional tax benefits to which you may be entitled.
For further information, please contact The Kennedy Center Vice President of Development at 203.365.8522, ext. 229 or email.