Give the Gift That Grows!
If you hold real property (e.g., real estate, stocks) that has increased in value and you have owned it for at least a year and a day, a gift of the asset outright to the Circus Arts Conservatory is a doubly creative gift idea. A gift of appreciated property allows you to avoid the capital gains tax otherwise due upon the sale of the asset – and, you are entitled to claim the full fair market value of the asset as a charitable contribution income tax deduction. You can deduct the gift’s value up to 30 percent of your adjusted gross income and carry forward any excess value for up to five years.
Outright gifts of real estate – or partial gifts via a bargain sale transaction – may be a desirable way for you to support the Circus Arts. One way that many donors find attractive is to make a gift of your primary or secondary residence – or even a farm. The key thing with this kind of gift is that you actually reserve the right to continue living there for as long as you or your spouse lives. Then, at a time in the future the Conservatory will benefit from this gift. As an irrevocable gift, you would be entitled to an immediate tax deduction for the present value of the remainder interest in the property. This gift is known as a retained life estate.
A gift of stock can be accomplished via your broker and offers you the opportunity to make a contribution at the fair market value on the day of transfer.
A gift of closely held stock produces a current income tax charitable deduction equal to the fair market value of the stock. If your corporation is concerned with an accumulated earnings tax assessment, a gift of closely held stock could reduce this liability. This is a complex gift and requires advance discussions to prepare a plan that is right for you.