What exactly is a 501(c)(3) nonprofit organization?

Nonprofit means the entity, usually a corporation, is organized for a nonprofit purpose. 501(c)(3) means a nonprofit organization that has been recognized by the IRS as being tax-exempt by virtue of its charitable programs.

What are the well-known benefits of donating property to a nonprofit?

What are the well-known benefits of donating property to a nonprofit? Donating property toa nonprofit does come with some popular tax benefits to the contributor. The first benefit is that there are no capital gains taxes on the donation of property. Secondly, you can take the donation as a tax deduction. Speaking with your financial advisor you can determine the best route to take when property to a nonprofit.

Unexpected benefits of donating property to a nonprofit organization

Unexpected benefits of donating property to a nonprofit organization. So, you know the two big benefits of donating property toa nonprofit. However, there are several unexpected benefits that comes from charitable donations as well.

No more upkeep costs

No more upkeep costs. Holding onto vacant or abandoned Chicago property can be costly. Property taxes, security, maintenance, and general upkeep can cost thousands of dollars every year. If you never use the property this is a costly way of holding on to something that has no real value to you. By donating property to a nonprofit, you can save yourself thousands of dollars a year.

Reduce the risk of owning unused property

Reduce the risk of owning unused property. In addition to the additional costs of hanging onto the unused property, you are also accepting risks. Abandoned real estate and vacant property falls victim to property damage from trespassers and the extreme Chicago seasonal weather. Aside from damage to your property, you are also responsible for injuries to people or others’ property that is damaged as a result of neglect.

Donating before depreciable wear-and-tear

Donating before depreciable wear-and-tear. One thing to consider when considering land donation is what is the expected depreciable wear your property will suffer in coming years. Are you able to repurpose or renovate your property? Is the property in good condition and being used? If you are not able to renovate your property or have no interest in doing so, donating your property early is better than later. This is because your tax benefits reduce as the depreciation on your home becomes worse over time.

Provide diverse alternatives for the nonprofit organization

Provide diverse alternatives for the nonprofit organization. Charities are often limited with their donations. Items such as clothing, toys, furniture, etc. can be sold or passed to families in need. There are few other options. By donating property to a nonprofit that charity can then use the property as they need. Office space. Warehousing. Activity center. Or the property can be sold as a part of their fundraising program.

Altruism

Altruism plays a huge part in charitable donations. Though, when donating many people don’t recognize how strong of a feeling it is to help others. It is a big step to donate property to a charity. You may be donating your grandparents inherited home. You may be donating commercial property that once belonged to your parent’s business. Whether you are donating residential or commercial property to a nonprofit, you likely have an attachment to that property. It is naturally altruism that helps you feel good about what you are doing as well as helps to push you to donating your charitable real estate.

Are you ready to donate property to a nonprofit?

Are you ready to donate property to a nonprofit? So, you’ve talked to your financial advisor or tax professional. You are ready to donate your property today! What do you do next?

If you are interested in donating a house, rental property, or commercial real estate to a nonprofit contact the Urban Renewal Project. We’d like to help you donate to a worthy cause in such a heartfelt way.