25th Jun, 2012

Thoughts about Gifting Real Estate in Breckenridge Area

Last month’s article in the Summit Daily News, “Giving Back,” raises the possibility of leaving or giving Breckenridge Colorado real estate to charity. Many owners of second or third homes in Breckenridge could be interested in the benefits of contributing Summit County real estate versus cash giving.

Steve Smith’s article on May 20, 2012 poses thoughtful questions:

  •  How much shall we plan to give?
  • Which causes will we support?
  • What kind of property shall we used to fund our contributions?

Vacation homes in Breckenridge, Keystone, Silverthorne, and the outlying areas of Summit County comprise a considerable portion of the average portfolio for second-home owners. Across the United States, real estate comprises over 35 percent of total household assets. Numerous senior property owners stew over what to do with excess real estate.

Whether a property owner is holding residential, commercial, ranch land, or undeveloped properties, there are a variety of vehicles for charitable contributions commonly used by people who donate real estate: Direct gifts, remainder and lead trusts and retained life estates, or flexible choices for funding planned gifts.

Smith, a principal at RightPath Investments & Financial Planning in Frisco is a member of the Summit Foundation Board of Trustees. He recommends consulting with one’s financial advisor and favorite charities. A first step may be speaking with one’s favorite charity or foundation to see if they accept gifts of real estate. Also, find out how such a gift can be structured. Then, the beneficiary must investigate the title, condition, and marketability of the property.

The size of the tax deduction is determined by the current market value of the property, not the purchase cost of the property. A real estate donation significantly reduces the legal and tax liabilities on the properties that are donated.

There are also ways to donate homes while still enjoying them during one’s lifetime. A life estate allows the owner to live in the house and receive the charitable tax deduction while they are still living. Upon death, the property title is transferred to the charity. Also, using a life estate, some donors are able to get a lifetime annuity to avoid passing a tax burden to family members when they pass on.

On July 13, 2012,during the Summit Foundation Peaks Society event 9:00-11:00 AM at Beaver Run, lawyer and author David S. Fry will speak about how to hand down a ski home to the next generation without creating family friction. The presentation should be quite informative.

Come on up to see Summit County Colorado real estate for sale to fit your budget and dreams. For information about buying real estate in our mountain villages, call Barrie Stimson, Breckenridge Realtor® at (970) 390-2560.

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