Types of Gifts

Gifts of real estate may include a personal residence, vacation home, farm, developed property, or undeveloped property.  Gifts may be made in various ways: outright gift, bargain sale, or a bequest and as funding for charitable gift annuities, charitable trusts, and retained life estates,

Prior to acceptance of real estate, the Seminary shall require an initial environmental review of the property at the donor’s expense, which ordinarily will be a Phase I environmental inspection.  In the event that the initial inspection reveals a potential problem, the Seminary shall retain a qualified inspection firm to conduct an environmental audit. An environmental audit is done for the benefit of the Seminary and the cost of it shall generally be at the expense of the Seminary.  If the gift is accepted, the Seminary will be reimbursed from the proceeds of the sale.  A title insurance binder shall be obtained by the Seminary prior to the acceptance of the real property gift.  The cost of the binder shall be an expense of the Seminary.

The following guidelines apply to gifts of real estate in general.

 

  • The donor must provide the Seminary with proof of clear title to the property.
  • The Seminary will normally not accept gifts of real estate that are expected to net less than $100,000 upon sale or to be held for an extended period of time before sale.
  • The donor shall provide the Seminary with a current appraisal of the property’s fair market value completed by a qualified appraiser commissioned and paid for by the donor.
  • Gifts of real estate shall be subject to further review by staff and/or the Trustees regarding environmental concerns, legality, mortgages, leases, easements, other restrictions or encumbrances on the property.    
  • Property accepted by the Seminary is normally subject to immediate liquidation and/or sale, as deemed appropriate by the Seminary.  Any fees related to the clearing title defects or clean-up costs will be deducted from the sale proceeds.

 


Retained Life Estate

The Seminary will accept a remainder interest in a personal residence, vacation home, or farm subject to the real estate acceptance policy above. Under this scenario, the donor deeds the property to the Seminary and retains the right to occupy the real property for life or a term of years or both. This right may extend to the donor’s spouse or other beneficiary as well. While living in the residence under the terms of a retained life agreement, the donor continues to be responsible for all appropriate maintenance and routine expenses associated with it, including insurance and real estate taxes. At the death of the donor and beneficiary or beneficiaries, the Seminary may use the property or convert it to cash. All gifts of real property subject to a retained life estate must be reviewed and approved by the Trustees upon recommendation of the Real Estate Acceptance Committee.

Bargain Sales

The Seminary may enter into a bargain sale arrangement with a donor in instances where the bargain sale furthers the mission and purposes of the Seminary.  A bargain sale occurs when a
donor, who intends to make a charitable contribution, sells real property to charity for less than its fair market value.  The excess of the fair market value over the actual sale price is the allowable deductible amount of the charitable contribution.  All bargain sales are subject to the real estate acceptance policy above and must be reviewed and approved by the Trustees, upon recommendation of the Real Estate Acceptance Committee.

The following guidelines will be used by the Seminary in determining the appropriateness of a proposed bargain sale transaction:

  • The donor shall provide the Seminary with a current appraisal of the property’s fair market value completed by a qualified appraiser commissioned and paid for by the donor.
  • If the Seminary assumes debt with real estate, the debt ratio must be less than 50 percent of the appraised market value.
  • The Seminary must determine that the real property will be used for its purposes, or that there is a market for the property enabling its sale within 12 months of receipt.
  • The Seminary will consider the costs to maintain, safeguard, and insure the property (including property taxes, if applicable) during the likely holding period.


For more detailed information about gifts of life insurance or any other planned giving opportunity offered by the Seminary, please contact the Director of Planned Giving, Lisa Titus.