Real Estate

You may have a second or, even, a third home. Your primary residence may no longer be practical. Giving real estate to the charity is a time-honored way of making a substantial gift with an asset, usually highly appreciated, that might otherwise be underutilized.

Procedures: To make a gift of real estate, whether or not it includes a dwelling or other buildings, the property should be free of financial encumbrances such as mortgages or liens. It should be readily marketable, and you should be aware that the Northwest Compassion Foundation may sell the property after it is given.

The Northwest Compassion Foundation will conduct an environmental assessment to insure that there are no hazardous waste conditions at the site that could become a liability to the new owner.

The donor usually pays for a property survey, appraisal, the environmental assessment, and the preparation of the deed transferring the property.

The gift date is the date of the closing.

Gift of Real Estate with Life Estate Reserved

If you have decided to leave your home or farm to the Northwest Compassion Foundation in your will, through a life estate gift you can make the gift now, realize an immediate substantial income tax deduction, yet continue to live in your home for as long as you wish. The property is appraised to determine a current value, then deeded to Northwest Compassion Foundation. You are entitled to a tax deduction calculated on the basis of your life expectancy. In life estate arrangements, you continue to be responsible for real estate taxes, insurance, maintenance, and upkeep.

Personal Property

You may donate assets such as jewelry, automobiles, paintings, and antiques as immediate gifts, or they can be used to fund life income gifts. As with real estate, you will need to pay for a bona-fide appraisal of the item by a qualified appraiser.

Procedures: Your lawyer creates a deed of gift, and a closing takes place at which the item is delivered and the documents are executed.

The gift date is the date on which this closing takes place.

Valuation: For your tax deduction to be based on the appraised market value of the item, the item must have a particular usefulness to the Northwest Compassion Foundation or a Northwest Compassion Foundation program. That is, the item must be related to the Northwest Compassion Foundation’s purposes. For instance, the value of a classical painting donated to an art museum is appropriate to the museum’s mission. It would be deductible at fair market value. But it would be far-fetched to declare that the same painting is compatible with the mission of a symphony orchestra. The tax deduction for a gift of personal property that is not related to the Northwest Compassion Foundation’s mission is deductible at cost basis only. You should consult with your tax advisors for the appropriate evaluation and reporting requirements.