You can make a gift to the Anne Carlsen Center of a remainder interest in your home, receive sizable tax benefits now and continue living in your home for the rest of your life.
With a retained life estate, you deed a personal residence or farm to the Anne Carlsen Center now. You retain the right to occupy the home for life and continue to pay real estate taxes, maintenance fees and insurance on the property. In addition, you can later decide to rent your home or make improvements to it. After your lifetime—and the lifetime of your spouse or another person you choose to retain rights to live in the home—we take possession of the property.
Profile of a Giver of This Gift
- You want to make a major gift to the Anne Carlsen Center after your lifetime.
- You enjoy living in your home and envision living there for the rest of your life.
- You’re happy to retain many of the rights and responsibilities of homeownership (maintenance, insurance, property taxes, etc.) and feel comfortable deeding us your home today.
- You want immediate income tax relief.
Is This Gift Right for You?
Many of our supporters would love to make a major gift to the Anne Carlsen Center but don’t have the means to make such a gift today. If this sounds like you, you may want to consider a charitable giving arrangement called a retained life estate. The amount of your income tax deduction depends, in part, on the value of the property and your age (and the age of any other person given life use). Your tax professional can help you determine what your benefit will be.
Benefits of This Gift
- You get the satisfaction of using your home to make a significant gift to the Anne Carlsen Center while retaining the right to live there for life.
- You qualify for a sizable income tax deduction in the year the gift is made. The amount of your tax deduction is based, in part, on your age and the value of the property.
- You can immediately deduct the amount of your gift up to 30 percent of your adjusted gross income and carry over any unused deduction for up to five additional years.
- The gift isn’t subject to capital gains tax.
- The property gift eliminates federal estate tax as long as the life estate was created for you and/or your spouse.
- If at any point you no longer wish to occupy the property, you can rent it to provide you with an additional source of income. Or, you can give the Anne Carlsen Center the right to use the property for the rest of your life. This will provide you with yet another tax deduction.
How to Make This Gift
To extend your support to the Anne Carlsen Center, consider these factors when arranging a retained life estate.
1. Decide whether you’d like the Anne Carlsen Center to receive your home after your lifetime – You could also decide to give a second home, vacation home, some other personal residence or farm. You’ll want to work with legal or tax advisors to help you determine the best assets to leave to family vs. charity. If you determine that you would like us to receive your home at your death, it is beneficial to arrange the gift via a retained life estate now because you receive an income tax deduction in addition to possible future estate tax benefits.
2. Instruct your estate planning attorney to prepare a deed to the Anne Carlsen Center - The deed will give title to our organization, yet specifically give you a life estate in the property.
3. Give the deed to the Anne Carlsen Center - This step completes the retained life estate arrangement. For all intents and purposes, your living arrangement remains largely the same. You agree to continue maintaining the home and paying taxes and insurance throughout your life. The main change—and benefit to you—is that you receive an immediate sizable income tax deduction for your charitable plans.
4. Enjoy your tax deduction this year and continue living in your home for life - Your tax advisor will work with you to determine the specific amount of your tax deduction based on the appraisal of your property. You still retain the rights to the property no matter what life changes occur. For example, even if you choose to move to a nursing home, you still have the right to occupy the property. We will not take possession of the property until after your death.
For More Information
We understand these gifts are complicated, that’s why we would be happy to work with you and your advisors to discuss a potential gift that meets your financial goals while also supporting our mission. You are not alone in making these life-impacting decisions. Please contact the Anne Carlsen Center Foundation at 1-800-568-5175 to help you answer any questions you may have or to futher discuss your giving options.
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The information on this website is not intended as legal or tax advice. For legal or tax advice, please consult an attorney. References to estate and income taxes apply to federal taxes only. State income/estate taxes or state law may impact your results.
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