More about Gifts of Personal Property
Many individuals donate personal property that has value. For example, you may choose to contribute artwork, collectibles, equipment and other items that help Woodland Healthcare Foundation advance its mission.
In turn for your gift of appreciated personal property to Woodland Healthcare Foundation, the IRS gives you two tax breaks: a charitable deduction for the full fair market value of the asset, and no capital-gains tax on the transfer.
If you are considering such a gift, please contact us first, as what you choose to donate may impact the amount of your charitable deduction.
Helpful tips to consider:
- You will need to secure an independent appraisal to establish the amount of your deduction.
- Most gifts of personal property are made outright. In rare cases, it may be possible for you to arrange for life-income to be paid to you in return for the gift. However, significant tax considerations make it advisable for you to consult your advisors and Woodland Healthcare Foundation before proceeding with such a plan.
IRS related-use requirement:
To obtain a full market value deduction for a gift of personal property, Woodland Healthcare Foundation's use must be related to its charitable purposes or functions. If not, the deduction is for cost basis only (or, if less, fair market value). To illustrate this, a gift of a painting to a museum should clearly be a related use gift. However, if the work of art is contributed, for example, to a charity that intends to sell the piece, the deduction may be for cost basis only.
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