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Charitable Bargain Sales
(Gift example)

You're ready to move to a retirement facility across town. You know that you will need some of the equity in your current home for the entry fees there. But your home has appreciated significantly over the years, and you would like to use some of the excess value to fund a gift to JDRF.

Example

You and your spouse donate a personal residence having an appraised value of $500,000, and an adjusted cost basis of $100,000 in a Charitable Bargain Sale arrangement. Bargain Sale price of the property is $125,000, payable in cash. Here are the calculations:

Charitable Bargain Sale

	Total	Sale Portion	Gift Portion
Value	$500,000	$125,000	$375,000
Basis	$100,000	$25,000	$75,000
Gain	$400,000	$100,000	$300,000

Summary of Benefits

Gift to JDRF	$375,000
Payment to donor	$125,000
Charitable deduction	$375,000
Reportable capital gain on sale portion	$100,000
Capital gains tax on sale portion (15%)	$0*
Capital gain forgiven on gift portion	$300,000
Capital gains tax savings on gift portion (15%)	$45,000

*Since there is a capital gains tax exclusion of $500,000 per couple on the sale of a personal residence, all capital gains tax is avoided in this example.

PLEASE NOTE: This example is for illustration purposes only and is not intended as legal or tax advice. Consult your own legal and tax advisors prior to making any material decisions based on this date.

For more information

Email us, complete the personal illustration form, or call us at 1-877-533-4483 so that we can assist you through every step of the process.

Alan Berkowitz
National Director of Planned Giving
Juvenile Diabetes Research Foundation International
120 Wall Street
New York, NY 10005-4001
1-877-533-4483
plannedgiving@jdrf.org

JDRF recommends that you consult your tax or legal advisors
prior to making a planned gift.