Example: Ellen sold the home she purchased many years ago for $30,000 to a philanthropic institution for the same amount, even though it was really worth $90,000 at the time of the sale. Her charitable contribution is $60,000 ($90,000 fair market value less $30,000 sale price).

Ellen does incur a capital gain in this type of transaction, but it's much less than for a sale at full market value. She is treated as having sold one-third of the property, so one-third of the $30,000 basis, or $10,000, is allocated to the sale portion. Therefore, she has a gain of $20,000 ($30,000 received from the sale less $10,000 basis attributable to the sale portion). However, $40,000 of the appreciation attributable to the gift escapes taxation. Plus, she receives a $60,000 charitable deduction.

A bargain sale accomplishes the gift and provides you with immediate cash, while also relieving you of the time, effort and costs of a normal sale.

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You create a tangible and enduring testimonial of your interest in our goals when you give your home or other real property. It's one of the most fitting contributions you can make. Your personal satisfaction is complemented by significant tax benefits.