A hypothetical case study in tax-smart giving

Katherine and Mark bought a piece of property 25 years ago for $50,000. This year, it was worth $500,000. Having a heart for evangelism, they wanted to sell the asset and then give the proceeds to The Idlewild Foundation.

Doing so, however, would have sent tens of thousands of dollars to the Federal government in taxes, instead of to the missionaries in critical need of those dollars.

Then Katherine and Mark learned that The Idlewild Foundation was able to accept innovative, non-cash gifts such as real estate, business interests, and restricted securities, and they were thrilled to make their gift before the sale. Why was this the tax-smart choice?

  • No capital gains tax: Katherine and Mark avoided capital gains tax, saving $94,500. These dollars went to support the ministry work of The Idlewild Foundation.
  • Higher charitable income tax deduction: They received a tax deduction of $500,000, the fair market value of their property. This saved them an additional $38,745 in income taxes.
  • Maximized gift: They were able to give $500,000 to charity instead of $405,500.

With the extra $94,500 The Idlewild Foundation could buy a year’s supply of Bibles and help train hundreds of missionaries to effectively spread the Gospel. With the extra $38,745, Katherine and Mark could help put their daughter through college. That is more than tax-smart, it is just smart period.

So how can we serve you? The Idlewild Foundation would be honored to explore how we can help you give in new, creative, and tax-smart ways. Please call us at (813) 264-8783 today to learn more.


Reprinted with permission from National Christian Foundation, Copyright 2011