Bargain Sale

Maximizing Tax Benefits and Giving Back: Susan and Kevin's Gift of Property

Years ago, Susan and Kevin bought a vacant lot on Lake Michigan for $40,000, hoping to build a second home. Over time, the property's value increased to nearly $200,000, but their plans to develop it were delayed.

Now that their children are grown, they decided to sell the lot but wanted to minimize the taxes from the sale. A CPA suggested an innovative approach: donate 25% of the property to their favorite charity before selling it.

By doing so, they received a charitable income tax deduction for the donated portion and avoided capital gains taxes. The deduction also helped offset taxes on the remaining $150,000 from the sale.

This strategy allowed Susan and Kevin to save on taxes and make a meaningful impact by giving $50,000 to The Salvation Army.

Note: This story's details represent typical donors and may not reflect an actual donor to our organization.