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Retained Life Estate Gifts

Gift Details

With the children grown, you may be thinking that within a few years you won't be using the cabin anymore. Or, perhaps you're considering a permanent move to a warmer climate — but want to test the waters first. You are looking for a flexible plan that protects you against uncertainty.

A retained life estate allows you to donate your personal residence (such as a home, cabin, or farm) while retaining the right to live on and use the property. When you make the gift, you retain the right to use the property for the rest of your life, a term of years, or a combination of the two. In exchange for your remainder interest gift, you receive an immediate income tax deduction.

This creative gift plan transfers your house to The Nature Conservancy but reserves a free lifetime tenancy to you. You can make a significant gift to The Nature Conservancy with the most valuable asset you hold, yet not disturb your living arrangements or your cash flow.

How does a retained life estate work?

You deed the residence to The Nature Conservancy, reserving a life tenancy for yourself.

You will continue to be responsible for the house's ongoing taxes, structural maintenance and upkeep. Your gift will provide you with a charitable income tax deduction, based on the fair market value of your house minus the present value of the life tenancy you have retained.

Planning points
  • First, as with all gifts of real estate, we must review and approve the transfer.
  • You will need to secure an independent appraisal of your home to establish its value for the deduction.
  • And finally, if there is a mortgage or lien on your home, it will complicate the transfer to us and could result in taxable income to you.

Our office can advise you on all these matters.

How do the numbers work?

Obviously, your exact benefits will depend on the value of property you are contributing, its condition, your age, and other market factors. However, we provided an example to give you a better sense of the benefits of a retained life estate.

A retained life estate is for you if ...
  • You want to use your residence to make a gift to The Nature Conservancy, but don't want to move out.
  • You are willing to deed your home, cabin, or farm to The Nature Conservancy if you can continue to live there rent-free.
  • You can continue to maintain your home.
  • Your home is not subject to a mortgage or other obligations.
Gift Example

You have always loved your home and have no plans to move from it. It has appreciated significantly since you bought it, and today it is the largest asset in your estate. You are considering a gift to The Nature Conservancy in memory of your sister but cannot locate an asset that you can part with comfortably.

You decide to donate your house to us, retaining a life estate for yourself and your spouse. You have secured an independent appraisal stating that your house is worth $250,000. The mortgage has been paid off.

Husband and Wife, 70 and 68
Asset Value$250,000
Charitable Deduction$93,763

*This example is based on a factor that changes monthly. Contact our office for a personal illustration based on the latest rates.

 

Discover other types of gift options with the Conservancy.

Compare all your giving options.

You can leave a legacy for nature. Learn about our Legacy Club.

 You can protect marine areas and other natural places by making a planned gift with The Nature Conservancy. Contact us today.
 

 

 

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