UNDERSTANDING THE OPTION
Real estate can sometimes be given outright, used to fund a charitable trust, transferred as a partial interest, or given subject to a retained right to live in a home or use a farm. Each arrangement creates different responsibilities.
Before acceptance, a nonprofit commonly examines title, marketability, environmental conditions, debt, insurance, carrying costs, restrictions, and anticipated sale. An independent qualified appraisal may be required for the donor’s reporting.
Do not sign a deed or create a binding sale agreement before the Episcopal Diocese of Chicago and your advisors review the proposal.
Why donors consider it
- May convert a difficult-to-manage asset into charitable impact
- May avoid a sale by the donor
- Could produce a charitable deduction when requirements are met
- May support a retained-life or life-income plan
A thoughtful process
- Contact the Episcopal Diocese of Chicago before transferring or marketing the property
- Provide basic property, title, debt, and environmental information
- Allow the organization to complete due diligence
- Obtain independent legal and appraisal advice
- Transfer only after written acceptance
Points to discuss with your advisors
- Mortgaged property can create tax and liability issues
- Not every property can be accepted
- Appraisal and transfer costs should be planned
- A prearranged sale can change tax treatment
This overview is not legal, tax, investment, or financial advice and does not confirm that the Episcopal Diocese of Chicago can accept a particular asset or arrangement. Please consult qualified advisors and contact the Episcopal Diocese of Chicago before taking action.