For many donors, gifts of real estate unlock a lifetime of strategic giving.
Mike and Carrie wanted to do something purposeful with their Austin condo. They initially purchased the property so Mike would have somewhere to stay during frequent business trips to Texas; throughout the pandemic, though, it sat mostly empty. The couple’s estate planning attorney suggested they partner with The Denver Foundation to turn an underused asset into an impactful charitable gift.
Last September, after discussing goals and options with the foundation’s gift planning officer, Mike and Carrie decided to give the condo to The Denver Foundation outright. The Denver Foundation took over from there, managing all aspects of the sale, saving Mike and Carrie trips to Austin and the hassle of stagings and showings. Their only out-of-pocket expense was the qualified appraisal needed to substantiate their tax deduction.
In Austin’s hot real-estate market, the condo sold quickly. Mike and Carrie used the proceeds of the sale to establish their new donor-advised fund at The Denver Foundation. Before the year’s end, the couple made their first donor-advised grants to several nonprofits, with an emphasis on education and basic human needs.
“We feel very lucky that we’re in the position we’re in, to be able to help and support others with their education,” says Carrie. “We wouldn’t have been able to get through college without help. We’ve worked hard, and we’ve had opportunities. We want to create opportunities for other people.”
For Mike and Carrie, the decision to donate their condo was a major step towards building a charitable legacy that will have an impact even beyond their lifetimes. The couple named their donor-advised fund as a beneficiary of some of their retirement accounts. When the fund closes, a portion of the remaining assets will be distributed to The Fund for Denver, The Denver Foundation’s permanent endowment. With these commitments, the couple has joined hundreds of engaged philanthropists in the Community Legacy Society, which celebrates donors who include The Denver Foundation in their estate plans.
“We see the condo as a gift that will kick off a series of gifts along a continuum of giving,” says Mike. “Our priorities may change, but our commitment to giving will not. And as our relationship with The Denver Foundation deepens, they’ll be a guide and hold a record of our giving even after we pass.”
No matter where a donor or fundholder is in their philanthropic journey, the idea of selling real-estate assets to fund giving can be daunting, requiring both time and money. Fortunately, The Denver Foundation’s Engaged Philanthropy team has the expertise to assist donors and professional advisors throughout the process. We understand that gifts of this magnitude can be an important element of an overall financial and estate plan, and we strive to create a gift process that is as smooth and accessible.
“People don’t always connect real estate with philanthropy,” says Rachel Spory-Leek, planned giving officer. “We talk more about cash, stocks, and sometimes retirement accounts. But for many people, real estate is their single largest asset, and their best opportunity to make a large gift that will have an impact in the areas they care about most.”
Spory-Leek encourages those considering a gift of real estate to consult with professional financial advisors who can explain the potential tax benefits of giving property directly, rather than selling first, then donating proceeds. Donors may also avoid paying capital gains taxes on the appreciation of their properties. Instead, they can deduct the fair market value of the property, up to 30% of their Adjusted Gross Income, in the year they gift the property, and then carry any remaining deduction forward for five additional years.
John Fuller, CEO of Fuller Real Estate and a leading real-estate professional in Denver for more than 40 years, says The Denver Foundation has earned a reputation as a respected and trustworthy partner capable of handling complex gifts, including real estate. Fuller trusts the foundation with his own family’s philanthropy.
“It has been our family’s privilege to have a donor-advised fund at The Denver Foundation for over 25 years,” he says. “There are so many benefits of making gifts of property for charitable purposes, tax advantages, disposing of a troubled asset, generosity, etc., but probably the greatest gift is knowing that you’re giving back to the community.”