Gifts of Property

If what you would like to donate has value but isn’t currently liquid, the College is interested in having a discussion about that real property with you – whether it’s real estate or any number of tangible items, such as equipment and optometry tomes.

Gifts-in-Kind Gifts-in-kind range from undeveloped land and buildings to professional optometric equipment and materials, such as books and journal subscriptions. Real estate can be donated and the contribution can be managed in a variety of ways to maximize the benefit to your life situation. Among the options to consider are Life Estate Agreements (below), and the Double Depreciation (Flip) Trust.

Items such as equipment and materials are accepted by the College on a case-by-case basis. Your tax deduction will be based upon your estimate of the fair market value of the item less depreciation. When considering making a donation, please take into account that the College is unable to pick up items and would appreciate the delivery of your donation during normal business hours.

To discuss any type of in-kind gifts, please contact Bill Heaton, Vice President of Advancement at wheaton@scco.edu or at 714.449.7464.

Life Estate Agreements

A donor may transfer title of his or her residence to the College and still occupy it for the rest of his/her life and/or spouse's or other beneficiaries’ lives. A second residence and/or a vacation home also qualify.

Charitable Income Tax Deduction

When a donor donates property and reserves a life estate, the College receives a remainder interest. The donor is entitled to a charitable income tax deduction for the value of the remainder interest.

The remainder interest must be reduced by the value of the lifetime use of the property by the donor and other beneficiaries and discounted by straight line depreciation during lifetime use. The calculations are prescribed by Treasury regulations and result in a substantial deduction for older donors.

In addition to the charitable income tax deduction, the property is also removed from the donor's taxable estate.

Residency and Transfer Options The donor(s) retains the right to occupy the property or to rent it out if he (they) choose to live elsewhere. The donor(s) may sell the lifetime interest or give it away or exchange it with the College for a life income arrangement. The person(s) owning the life estate maintains the property and continues to pay the property taxes, insurance and other expenses. The Right to Will the Property In effect, the substantial right the donor(s) gives up is the right to will the property. Donors who have already willed their home to a charitable institution are ideal prospects to give it presently, while retaining a life estate and enjoying the income tax deduction together with the satisfaction of making the gift to charity during their lifetime.

Calculating the Charitable Tax Deduction

In order to calculate the charitable income tax deduction associated with retained life estates, the following information is necessary:

1. The present market value of the property.
2. The percentage of value assigned to the land alone. (Appraisers will usually note this or it can be obtained from the property tax bill.)
3. The estimated useful life of the improvements.
4. The estimated salvage value of the improvements at the end of the useful life.
5. The birthdates of the life tenants.

Any examples given are meant to be illustrations of the benefits of charitable vehicles available to you. This should not be construed as legal or tax accounting advice. Always consult an attorney for specific arrangements. The College can assist you in this regard.

For further information on life estate agreements, fill out the Request for Information Form or contact Bill Heaton, Vice President of Advancement at wheaton@scco.edu or at 714.449.7464.