Put Your Property
to Good Use
Mike, a recently retired CEO of a publicly traded company, was ready to downsize. His financial advisor suggested an interesting option that would not only simplify his lifestyle but also help fund Mike’s passion to support charities focused on issues related to homeless youth during his retirement. Mike had purchased a house at the beach years ago, and it had turned out to be a very good investment. Over time, it had appreciated, and Mike’s financial advisor suggested that he use the house to provide funds for his philanthropic plans, especially since his income in retirement would be reduced.
Instead of selling the house now valued at $1.5 million and contributing the proceeds in cash, Mike’s advisor suggested a better way: By contributing the asset to Fidelity Charitable®, Mike would be able to take a tax deduction of the fair market value of the house, based on a qualified appraisal*, and eliminate his capital gains tax on the appreciation.
Reach Rewarding Results
Fidelity Charitable was able to sell the asset, and the proceeds went directly into Mike’s Giving Account®. As a result, Mike reduced his tax obligation by $365,473 and was able to dedicate $261,800 more to charity than if he had contributed the after-tax proceeds from the sale of his house.* Fair market value of the property, as assigned by an independent qualified appraiser, must be reported to the IRS by the donor on IRS Form 8283.
tax obligation by: 365,473
to charity: 261,800
Potential benefits of donating real estate directly to Fidelity Charitable®
- Provide more money to charities
- Minimize capital gains tax exposure
- Receive a tax deduction
Donate When and Where You Want
In addition to enjoying tax benefits and providing additional funds to charity, Mike also enjoyed an additional benefit: the spontaneity of giving with a dedicated charitable fund. Immediately after hearing an inspiring radio interview with the founder of a homeless outreach organization, Mike felt touched by her story and though, “This is a group I want to help.” And it was simple for him to do so – just by recommending a grant from his Giving Account®.
Have Something Similar In Mind?
If a donation scenario like Mike’s sounds like it could fit your personal situation, know that Fidelity Charitable has the experience and technical expertise to help. Fidelity Charitable can:
Simplify the process of contributing high-value, highly- appreciated real estate
Help you realize the most favorable tax consequences with the greatest charitable impact
Guide the entire asset transfer process
(Please see considerations when contributing real estate)
Work with you and your advisors in advance of the contribution