Types of Real Estate Gifts
A retained life estate agreement is one way to contribute real estate to benefit IU School of Medicine. This type of gift allows a donor to continue living in and enjoying using the home, vacation home or farm while establishing a gift of that property. The donor receives a charitable tax deduction in the year the gift is made, and IU receives the property at the end of the retained life estate term, usually in the person’s lifetime.
As part of a bargain sale, a donor agrees to sell a house to the Indiana University Foundation for less than its appraised value and receive an immediate cash payment. The IU Foundation later sells the property at fair-market value, and the profit benefits the area of the donor’s choosing at IU School of Medicine. Among advantages of this type of gift are the up-front payment for the sale, eligibility for a charitable deduction, and avoidance of the hassles of putting a property on the market.
Farmland may also be donated to benefit IU School of Medicine. Like homes and vacation homes, donors may consider a bargain sale or can choose to continue living on the farm after it’s been donated. Donors may also want to explore the possibility of a giving vehicle that pays income for the rest of their life, such as a charitable remainder trust or gift annuity.