Making a gift of property
Gifts of appreciated property, such as a farm, personal residence or undeveloped land, are tax-deductible at full market value, and they relieve the donor from capital gains tax on the appreciation.
For example: If you own a building you purchased for $50,000 several years ago and today its market value is $150,000, you may donate it to CCBC and receive an income tax charitable deduction for the full appraised value, or $150,000. In addition, you avoid paying tax on the gain. Your total gift of $150,000 was made at an after-tax cost of $83,500 (assuming a 31% tax bracket).
If your property has a mortgage, it is still possible to give the property to CCBC through a gift process, which involves a "bargain sale." You may also contribute property to the college, receive an immediate income tax deduction, and still continue to use the property for as long as you wish through a "life estate."
The "life estate" allows you to make a gift of property but continue to use it as long as you desire. Assume you and your spouse are near retirement and pay a good deal of income tax each year. You own the home in which you live, having paid off the mortgage several years ago. You plan to live in the home for the rest of your lives, but you would also like to leave a significant gift to CCBC. You decide to donate the home, appraised at $150,000, to the college, while retaining the use of the home for the rest of your lifetimes. Based on your age and other factors, you receive an immediate income-tax deduction, and you also reduce your estate tax liability.
Many other types of personal property, including antiques, artwork, books, collectibles, historical collections, patents and copyrights, etc., may make excellent charitable gifts to CCBC and generate tax deductions equal to their full market value. Gifts of personal property of $5,000 or more require a certified appraisal to establish the value of the gift.