Gifts of real estate may consist of many types of property: a principal residence or a vacation residence, a farm, a commercial building, subdivision lots, or undeveloped land. The gift may be the entire property or a fractional interest in the property. The same benefits that accrue to gifts of appreciated securities apply to gifts of appreciated real estate. Gifts of real estate can be made as outright gifts or as life income gifts, such as a charitable remainder trust. Meredith College requires an environmental survey of the real estate before accepting a gift.
Example: Paula, age 72, wants to make a substantial gift to Meredith College and also remove some assets from her taxable estate. She decides to give her home, with the reserved right to use the house for the rest of her life. Her accountant, using a formula prescribed by the IRS, determines the value of her income tax deduction.