Donate Property

As with gifts of securities or real estate, a donor is entitled to a charitable deduction for gifts of tangible personal property (e.g. works of art, rare books, stamp or coin collections, etc.), which are called gifts-in-kind. The extent of the allowable deduction for a gift of such property held long-term is dependent upon the standard of "related use."

Here's how the standard is applied: If the use of the contributed property is related to the exempt purposes of the charity (e.g., rare books to the library, a painting to the galleries, etc.), then the donor would be entitled to a charitable deduction for the full fair market value of the property, subject to the 30 percent ceiling and carry-over.

If the use of the contributed property is unrelated to the exempt purposes of the charity (e.g., stamp collection to a hospital to sell and use the proceeds), then the donor would be entitled to a charitable deduction only for his or her basis in the property.

One other note: If the donor is the creator of the contributed tangible asset (for example, the artist of a painting), then his or her deduction is limited to the actual cost in producing the asset.

Tax advantages

Gifts-in-kind (books, livestock, works of art, etc.) are deductible at the full fair-market value if they are related to educational programs or activities of the University and have been held for more than one year by the donor.

For further information concerning gifts-in-kind, contact the Advancement Office at (219) 989-2323 or (800) HI-PURDUE, ext. 2323; or e-mail advance@calumet.purdue.edu

Gifts of Real Estate

There are several options available:

Outright: If you make an outright gift of real estate to Purdue Calumet during your lifetime, you will be entitled to a federal income tax charitable contribution deduction for the full fair market value of the property on the date of your gift.

Retained life estate: This type of gift allows you to give your residence or farm to Purdue Calumet now while retaining the right for you and/or someone else to have possession of the property (and receive any income from the property) for life. You would be entitled to a current federal income tax charitable contribution deduction for the value of Purdue Calumet's remainder interest in the property. You also will avoid tax on the property's capital gain.

Gift with a lifetime income: You may contribute the real estate to Purdue Calumet in exchange for a lifetime income from the property. Under this option, the property is used to fund a type of charitable remainder unitrust. This arrangement will provide you and/or another beneficiary with a lifetime income from the trust. Further, you would be entitled to a current federal income tax charitable contribution deduction equal to the value of Purdue Calumet's remainder interest in the property. Plus, it avoids tax on the property's gain.

Testamentary: Another option is to leave the real estate to Purdue Calumet in your estate. This arrangement will not provide you with a current income tax deduction, but your estate would be entitled to a federal estate tax charitable deduction for the full fair market value of the property.

For more information on any of these options, please call the Advancement Office at (219) 989-2323 or (800) HI-PURDUE, ext. 2323; or e-mail advance@calumet.purdue.edu

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