Gifts of Real Estate
A gift of real estate to the Tyler Junior College Foundation provides a charitable deduction for the full fair market value of the gift - up to 30 percent of your adjusted gross income if you have held it for more than six months - with the usual five-year carryover.
As with other appreciated property, transferring the asset to the Foundation avoids any capital gains tax in most cases. You will need to have your gift of real estate appraised by an independent appraiser to determine the value of your deduction. Also, be sure to consult with the Foundation to make sure your real estate is appropriate for the College's use. Gifts of real estate usually have a minimum equity of $25,000.
It is the policy of the Tyler Junior College Foundation to exercise business prudence and fiduciary responsibility when considering the acceptance of gifts of real estate. Therefore, the Foundation sets forth the following procedures to govern the process by which the Foundation determines to accept or decline offers of gifts of real estate.
Procedures: The Foundation shall follow the below-listed procedures in determining whether or not to accept offers of gifts of real estate. Foundation staff shall coordinate its review efforts with appropriate property management consultants and shall seek input from the consultants in determining the acceptability of real estate gift offers. When considering the acceptance of real estate gift offers, Foundation staff shall:
- identify the donor while maintaining appropriate levels of confidentiality;
- determine the legal and geographic description of the property, and the location of the property;
- ascertain an estimated value of the property from the potential donor and the basis (comparables, appraisals) on which that estimated value is determined;
- determine whether the proposed gift is a one-time gift or if it is part of a longer term gift program;
- determine the terms and conditions of any gift program pursuant to Item #4 above;
- inform the potential donor, in writing, of Foundation policy and procedures governing the acceptance of offers of gifts of real estate;
- in cases of acceptance of the gift offer (see Gift Acceptance below), obtain a title policy or other bona fide verification of title, including information on liens or encumbrances, at the time of closing.
- Upon receipt of the above-stated information from the Foundation, the necessary property management consultants shall perform the following duties:
- physically inspect the real estate in question and complete, as a record of the inspection an environmental inspection form;
- identify, as part of the physical inspection, any environmental concerns which may be readily apparent;
- recommend to the Foundation and to the potential donor on the advisability of an environmental survey (see Special Conditions - Environmental Surveys below) at the prospective donor's expense;
- perform an independent assessment of the current and projected market value of the real estate in question, including an assessment of any potential income streams; and
- conduct sufficient study of the property to permit the consultant to report its findings to the Foundation staff and the President of Tyler Junior College, and to recommend acceptance or declination of the gift.
Should the property management consultant, upon inspection of the real estate, determine that an environmental survey is not warranted prior to consideration of gift acceptance, the property management consultant shall report such to the Foundation, and shall recommend gift acceptance or declination. If the consultant recommends acceptance, the President, or his or her designee, may accept the gift on behalf of the Foundation, subject to the terms and conditions of the report. If the property management consultant recommends declination of the gift, the President, or his designee, may decline the gift on behalf of the Foundation.
Special Conditions-Environmental Surveys
Should the property management consultant, upon inspection of the real estate, determine that an environmental survey is warranted prior to consideration of gift acceptance, the property management consultant shall recommend completion of the survey. The cost of the survey shall be borne by the prospective donor. The property management consultant shall review the results of the survey, and shall recommend acceptance or declination of the gift to the Foundation staff. Foundation staff shall refer the matter to the President and the Executive Director of the Foundation.