Real Property
Your gift of real property to The University Foundation at Sacramento State can provide a legacy to benefit the students of future generations. Whether the proceeds from the sale of the property are designated for scholarships, equipment, curriculum enhancement, or other purposes, your donation can make a real and lasting difference in the lives of the students it touches.
Benefits of Giving Real Property:
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A substantial tax deduction
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Potential saving of expenses on property that generates bills but no income
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Relief from the burden of management responsibilities
- Income for life, based upon the property’s full value, without erosion to capital-gains taxes
Types of Real Property
Raw Land - Donors with raw land may find it an especially useful asset to give. While the property can take years to sell, the donor may be immediately relieved of property taxes and any other expenses, while gaining a valuable deduction.
Rental and Commercial Property - Many people invest in rental property only to find one day that managing it has become a burden; yet, selling would be too costly: depreciation has lowered the cost basis, the property has grown in value, and the capital-gains taxes would be horrendous. Giving the property can be a relief (while providing an alternative income stream if given for a life income gift(pdf)). The same principle applies to commercial property, which may often take months or even years to sell.
A Vineyard, Farm, Ranch, or Personal Residence - Special rules apply to these assets, which make it possible for donors to "give" the property, yet continue to own it for the remainder of their lives. Or, if they're ready to move, they can donate all or part of it outright, or for a life income gift(pdf).
Ways of Giving Real Property
There are as many ways to give real estate as there are types of real property. Here are some commonly used methods:
- An outright gift of property is the simplest way to give and provides the largest deduction.
- Donors who are contemplating a sale of property can first give an undivided fractional interest to The University Foundation at Sacramento State. They avoid some gain on the sale, while receiving a charitable deduction.
- Donors who own property that The University Foundation at Sacramento State would like to acquire can sell it to the Foundation for less than its fair market value and receive a deduction for the difference between the purchase price and its value.
- Donors with highly appreciated property can give the property to a charitable remainder(pdf) trust. The trust sells the property, without paying capital-gains taxes, and the entire proceeds go to work to generate an income for the donor.
- Donors of a vineyard, farm, ranch, or personal residence can give a remainder interest in the property to The University Foundation at Sacramento State. They continue to use the property for the rest of their lives, while receiving a substantial income tax deduction for the value of the remainder interest.
For more information, contact Deborah J. Rice, Director of Planned Giving