Almost any type of real property, a personal residence, a farm, a vacation home, a commercial building, or an undeveloped parcel of land can be an important gift to Mercyhurst University. Gifts of real estate may be made either outright or used to fund a charitable remainder unitrust. You may gift all or a percentage of your real property to Mercyhurst, and your gift may be given during your lifetime or through your will.
If you give your real estate outright to the University, you will be eligible for a charitable income tax deduction based on the full fair-market value of the real estate you give. You will avoid the capital gains tax you would have had to pay if you had sold the property, and you will have made a generous gift to Mercyhurst. Also, because you have removed the property from your estate, you may have also reduced your estate taxes. Mercyhurst requires the donor to bear certain costs when making a real estate gift, such as an appraisal to determine the fair market value.
Retained Life Estate
Do you want to receive a current income tax deduction for the gift of your home, but would like to continue living there for the rest of your life? If so, you could give Mercyhurst a “remainder interest” in your home and retain a “life estate” for yourself. You will be eligible for a current income tax deduction based on the value of the remainder interest you have given, and you will have the right to live in your home for the rest of your life. Only after your death will the University assume the usual ownership rights in the property.
How It Works:
- Transfer title to a personal residence or farm to Mercyhurst University.
- Mercyhurst allows you (and your spouse) to remain in your residence for life.
- You (and your spouse) occupy and maintain residence.
- Mercyhurst uses or sells property after your death(s).
- If the property is sold, the proceeds can be used for a purpose you designate.
By setting up your gift now, rather than in your will, you will receive an immediate tax deduction.
You also can give an “undivided interest” in property that you own and receive an immediate income tax deduction. For example, you could make Mercyhurst the owner of a 50 percent interest in your vacation home. Mercyhurst’s benefit is that, when the property is sold, it will receive 50 percent of the proceeds. The sale can be during your lifetime or even after your death. And the real benefit to you is a deduction for about 50 percent of the value of the gift property. The deduction will reduce your current income taxes thus increasing your spendable income. All while supporting Mercyhurst.
A gift of real estate entitles you to membership in the O’Neil Society, the recognition society for those giving to Mercyhurst through their will or other estate-related gifts.