Several of Schreiner’s friends have used personal residences to create generous charitable gifts. One popular gift plan is donating one’s mortgage-free home in exchange for a life income gift. In Mrs. Hall’s plan, her home funded a charitable gift annuity, providing a guaranteed life income and then, after her death, supplementing her family’s endowed scholarship. (See accompanying story).

To accomplish this plan, Schreiner’s donors transfer their homes through a simple gift deed registered at the county courthouse. Once the transfer is complete, the donors sign a gift annuity agreement with the Texas Presbyterian Foundation. In most cases, the gift annuity will be calculated on 85 percent of the home’s fair market value as determined by an independent, licensed appraiser.

Donors appreciate gift annuities because they provide a high payout rate and are guaranteed for life. In Mrs. Hall’s plan, the gift annuity pays a rate equivalent to 9.1 percent! Even more compelling, the donor begins receiving income immediately, even if the house has not yet sold!

Another popular planned gift is the reserved life estate. A donor signs a gift deed that stipulates a charitable entity is to receive the donor’s home after his/her death. The eventual gift to charity earns an income tax deduction the year the gift deed is signed. The deduction amount is a percentage of the home’s fair market value. The older the donors are, the higher the income tax deduction they receive.

Donors have full use of their homes just as they always have. Charities do not have property rights until the donors have died. In the meantime, donors are responsible for “M-I-T.” That is, they continue to pay maintenance, insurance and taxes for the property. If the donors decide to sell the property, they can do so. A formula based on their ages determines what percentage of the sale proceeds goes to their “split-interest” charity.

Setting up either of these gifts requires some initial costs. The property must have a certified appraisal and, in a few cases, an environmental impact study might be required. The donor also pays attorney’s fees to draw up the transfer deed. Preparation of the gift annuity document is without charge.

Schreiner welcomes all inquiries about gifts of personal residences and other appreciated property. Our goal is to reach $100 million in endowment by 2012. Current endowment is $39,483,808.

If you would like more information about these and other planned gift options, please contact Karen Davis Kilgore at kkilgore@ktc.com or 830-896-1787.