Outright Gifts

Outright lifetime gifts to a charity generally qualify for an immediate income tax deduction to the donor. The amount of the charitable deduction for income tax purposes is subject to limitations, which depend on the type of property contributed.

Gifts of Cash

If an individual makes an outright charitable contribution of cash an immediate income tax deduction is allowed.

Gifts of Property

If the donor makes a contribution of appreciated property such as securities or long-term real estate holdings a deduction may be made for the fair market value of such property, with no tax on the appreciation. For a property that has decreased in value, it may be better to sell the property and make a cash gift of the proceeds. This allows you to establish a capital loss that can be deducted from taxes in addition to the charitable deduction you can claim from the cash donation. There are also ways to make a gift of property and still retain the right to enjoy the use of the property as long as you are alive. Your financial advisor can assist you in determining the best approach for specific real estate.