You’re considering a gift made during your lifetime > You hold a transferable interest in a viable investment partnership > You want to save both income and capital gains tax
Gifts of transferable partnership
interests – primarily in real estate or oil
and gas ventures – can benefit both you and
your favorite charity. Gifts are usually made
outright, but in some cases may be used to fund
a life-income gift such as a unitrust.
Donors who invested in a partnership to secure
the tax losses generated in its early years may
look to donate their interest once income starts
flowing to the partners.
Your charitable deduction will be based on the difference between your share of the fair market value of the partnership and your share of its liabilities.
Both you and your charity must take some preliminary steps before you transfer partnership interests. You should first determine if the partnership allows shares to be transferred, then consult with your attorney and accountant. Because gifts of partnership interests involve issues of marketability, taxation, liability and the potential of later assessments by the partnership, their financial officers must first review and approve any transfer.
