Gifts of Real Estate With proper planning and timing of a charitable real estate gift, a donor will enjoy added benefits created by incentives in our tax system. Did you know that gifts of real estate which are held long term (i.e., longer than one year) are generally tax deductible at full fair market value, with no tax on the appreciation above original cost? Gifts of appreciated real estate such as undeveloped land, farms, or personal residences may be transferred by deed to Northern with no liability for income or estate taxes on the appreciation. For this reason, many supporters of Northern have opted to make contributions of real estate where the current market value of the gift may be significantly greater than its original cost. It is a wonderful way to make a significant impact on the university's outstanding students and academic programs. If the market value of the contributed real estate exceeds $5,000, an income tax charitable deduction will not be allowed unless the donor complies with IRS "qualified appraisal" requirements. A qualified appraisal can be done any time from 60 days before the donation, up until the due date (including extensions) for the return, on which the donor reports or claims the gift. Further, if a donor contributes a partial interest in real property, then the partial interest must be appraised. The appraisal fee will be the obligation of the donor, who can deduct the cost of the appraisal as an IRC, Sec. 212(3) deduction, not as a charitable deduction under the IRC, Sec. 170. For more information, please contact John Sentovich, Director of Gift Planning, at 815-753-1344 or e-mail sentovich@niu.edu.