Retained Life Estate

How It Works

  • You transfer the title to your residence, farm, or vacation home to IHC and live there for the rest of your life.
  • Continue to live in the property for life or a specified term of years, and continue to be responsible for all taxes and upkeep.
  • The property passes to IHC when your life estate ends.

Benefits

  • You can give us a significant asset but retain the security of using it for the rest of your life.
  • You receive an immediate income tax deduction for a portion of the appraised value of your property.
  • You can terminate your life estate at any time and may receive an additional income tax deduction.

Frequently Asked Questions

Do I have any other option other than having the charity take possession of the house should I want to move out of the property prior to my death?

If you negotiate a provision in the Retained Life Estate contract for the right to lease the property for the remainder of your life estate you can keep the additional money. You remain responsible for the taxes, insurance and maintenance expenses spelled out in the agreement with the charity.

Who is responsible for building modifications, additions and custom items like a work shop, extra garage or swimming pools?

You are. Most likely the RLE contract will contain a provision that requires you to get prior approval from the charity to make such improvements.

Can we move out and then back in?

Yes. The use of the asset is yours. Should you decide to lease for a while and then move back in this gifting concept allows for that.

Can we use our second home to create a Retained Life Estate?

Yes. As long as the property qualifies under the IRS rules it can be used create this type of donation arrangement (i.e. you don’t take depreciation or own it in a corporate structure, etc.) Check with your accountant to make sure it qualifies. Motor coaches and yachts qualify as second homes.