A properly timed charitable real estate gift will allow a donor to enjoy added benefits created by incentives in the tax system.
Gifts of real estate which are held long term (i.e., longer than one year) are generally tax deductible at full fair market value, with no tax on the appreciation above original cost.
Gifts of appreciated real estate such as undeveloped land, farms, or personal residences may be transferred by deed to the Illinois College of Optometry with no liability for income or estate taxes on the appreciation. For this reason, it may make sense to make contributions of real estate where the current market value of the gift may be significantly greater than its original cost. It is a wonderful way to make a significant impact on the College’s outstanding students and academic programs.
If the market value of the contributed real estate exceeds $5,000, an income tax charitable deduction will not be allowed unless the donor complies with IRS "qualified appraisal" requirements.
A qualified appraisal can be done any time from 60 days before the donation, up until the due date (including extensions) for the return, on which the donor reports or claims the gift. The appraisal fee will be the obligation of the donor, who can deduct the cost of the appraisal as an IRS, Sec. 212(3) deduction, not as a charitable deduction under the IRS, Sec. 170.