Receiving Real Estate as In-Kind Donations to Paramount Impact

What Are In-Kind Donations?

In-kind donations are contributions of goods, services, or assets—other than cash—to a nonprofit organization. For a 501(c)(3) public charity like Paramount Impact, founded in 2024, in-kind donations can include tangible assets such as real estate, equipment, or supplies, as well as intangible assets like stocks or professional services. Donating real estate, such as residential homes, commercial properties, or undeveloped land, is a powerful way to support Paramount Impact’s mission to empower communities through education, philanthropy, and aid for underserved populations, including individuals with disabilities or those experiencing poverty. This article outlines how to donate real estate as an in-kind contribution to Paramount Impact, what can be done with the donated property, and the associated benefits and requirements.

Why Donate Real Estate to Paramount Impact?

Real estate donations provide significant support for Paramount Impact’s programs, such as funding educational initiatives or community development projects. They also offer donors unique benefits:

Tax Deductions: Donors may claim a charitable income tax deduction based on the fair market value (FMV) of the property, potentially up to 30% of their adjusted gross income (AGI), with a five-year carryover for excess deductions.
Avoid Capital Gains Tax: By donating appreciated real estate held for more than one year directly to Paramount Impact, donors can avoid capital gains tax, which could be up to 20% if the property were sold.
Legacy Impact: Real estate gifts support Paramount Impact’s long-term goals, creating a lasting legacy aligned with your philanthropic vision.
Simplified Process: Paramount Impact collaborates with donors and their professional advisors to streamline the donation process, ensuring compliance and ease.

For example, donating a rental property could fund Paramount Impact’s initiatives, such as supporting youth mentorship programs, while saving the donor on taxes and maintenance costs.

What Can Be Done with Donated Real Estate?

Once donated, real estate can be used in several ways to advance Paramount Impact’s mission, depending on the property’s characteristics and the donor’s preferences:

Contribute to a Donor-Advised Fund (DAF): The real estate can be donated to your DAF at Paramount Impact, either held as an asset or sold to generate funds. Proceeds from the sale can be invested tax-free within the DAF, allowing you to recommend grants to qualified 501(c)(3) organizations over time. For example, a donated commercial property’s sale proceeds could fund grants for education programs, managed through our donor portal.
Fund a Charitable Mission via Fiscal Sponsorship: The property or its proceeds can support a fiscally sponsored project under Paramount Impact’s Model A sponsorship. For instance, a donated lot could be sold to finance a project like a community health initiative, with funds managed through the project’s designated account and accessible via our online portal for expenses, vendor payments, or per diem accounts.
Support Paramount Impact’s Charitable Programs: The property can be used directly or sold to fund our core programs, such as providing educational resources for homeschooling families or aiding underserved communities. For example, a donated vacation home could be repurposed as a community center or sold to finance poverty alleviation efforts.
Hold for Future Use: In some cases, Paramount Impact may retain the property for operational purposes, such as using a building for program expansion, provided it aligns with our mission and financial capacity.

Paramount Impact evaluates each property to determine the best use, balancing mission impact, marketability, and donor intent. Donors contributing to a DAF can recommend how proceeds are distributed, while fiscal sponsorship or program donations are directed per the project or program’s needs, always within IRS guidelines.

Types of Real Estate Paramount Impact Accepts

Paramount Impact considers a variety of real estate types for in-kind donations, provided they align with our mission and operational needs. Acceptable properties include:

Residential properties (e.g., homes, condos, apartments).
Commercial properties (e.g., office buildings, retail spaces).
Undeveloped land (e.g., vacant lots, farmland).
Vacation homes or rental properties.

However, Paramount Impact conducts due diligence to ensure properties are free of environmental liabilities, excessive debt, or other risks that could impact our financial or reputational standing.

How to Donate Real Estate to Paramount Impact

Follow these steps to donate real estate as an in-kind contribution to Paramount Impact:

Contact Paramount Impact
Reach out to our team directly by calling (480) 608-3000 or emailing team@paramountimpact.org to discuss your intent to donate real estate. Specify your preference for the donation’s use (e.g., DAF, fiscal sponsorship, or Paramount Impact programs) and provide details about the property, such as its type, location, estimated value, and any encumbrances (e.g., mortgages or liens). This initial conversation helps us assess alignment with our mission and gift acceptance policy.
Property Assessment
Paramount Impact conducts an initial assessment to evaluate the property’s viability. This may include:
- Reviewing title documents to confirm ownership and check for liens.
- Assessing environmental risks or legal issues (e.g., contamination or zoning restrictions).
- Determining whether the property can be used directly, held, or sold to fund a DAF, fiscal sponsorship, or our programs.
  The assessment may be conducted remotely or in-person, depending on the property’s complexity and location.
Obtain a Qualified Appraisal
If the property’s value exceeds $5,000, IRS regulations require a qualified appraisal by an independent appraiser to establish its fair market value (FMV) at the time of donation. The donor is responsible for paying for the appraisal to ensure Paramount Impact receives a copy for IRS compliance. The appraisal must:
- Be completed no earlier than 60 days before the donation date and before the tax return due date (including extensions).
- Follow the Uniform Standards of Professional Appraisal Practice.
- Be signed by a qualified appraiser not related to the donor or Paramount Impact. For properties valued at $5,000 or less, the donor may determine the FMV based on comparable sales, but documentation is still required. Paramount Impact can recommend appraisers upon request.
Complete Required Documentation
To substantiate the donation for tax purposes, the donor must:
- Complete IRS Form 8283 (Noncash Charitable Contributions) and include it with their federal tax return. For properties valued over $5,000, both the donor and appraiser must sign Section B of Form 8283, and Paramount Impact will acknowledge receipt.
- Obtain a written acknowledgment from Paramount Impact, stating the property description, date of receipt, and that no goods or services were provided in exchange (or their estimated value if applicable). If the property is valued over $500,000, the appraisal must be attached to the tax return. For DAF or fiscal sponsorship donations, additional documentation may specify the fund or project’s name and intended use.
Transfer Ownership
Execute a deed transferring ownership of the property to Paramount Impact, your DAF, or a fiscally sponsored project’s account. Our team coordinates with your professional advisors (e.g., real estate attorneys, accountants, or financial planners) to ensure a seamless transfer, whether for a DAF, fiscal sponsorship, or direct program support. Donors are responsible for covering closing costs, such as title fees, to complete the transfer. Once the transfer is complete, you’ll receive a receipt within 24 hours for tax purposes.
Access Paramount Impact’s Donor Portal
If the donation is made to a DAF or fiscal sponsorship, you’ll gain access to our secure online portal, where you can:
- Recommend grants to qualified 501(c)(3) organizations (for DAFs) or manage project expenses (for fiscal sponsorships).
- Use debit cards or per diem accounts for approved charitable expenses.
- Pay vendors directly for project-related costs.
- View real-time account statements to track funds, grants, or investment growth.
  Our team provides onboarding to guide you through the portal’s features and, if applicable, legacy planning options for your DAF.

Paramount Impact’s Due Diligence and Gift Acceptance Policy

Paramount Impact follows a rigorous gift acceptance policy to ensure real estate donations align with our mission and do not pose financial or legal risks. Key considerations include:

Marketability: Can the property be sold or repurposed to fund a DAF, fiscal sponsorship, or our programs?
Liabilities: Is the property free of environmental hazards, liens, or excessive maintenance costs?
Mission Fit: Does the donation advance our goals, such as funding education or community initiatives?
Properties with significant debt or environmental issues may be declined to protect Paramount Impact’s resources. Our team works transparently with donors to explain decisions and explore alternatives, such as redirecting the donation to a DAF or fiscal sponsorship.

Tax Benefits and Considerations

Donating real estate to Paramount Impact offers significant tax advantages, but donors should consult their tax advisors to confirm eligibility:

Charitable Deduction: The deduction is based on the property’s FMV, typically limited to 30% of AGI for appreciated property held over one year, with a five-year carryover.
Capital Gains Tax Savings: Direct donation avoids capital gains tax, increasing the amount available for charity compared to selling the property and donating after-tax proceeds.
Form 8282 Requirement: If Paramount Impact sells the property within three years, we must file IRS Form 8282 and provide a copy to the donor, reporting the sale price.
Legacy Integration: Real estate donations to a DAF can be part of an estate plan, allowing donors to name successors or charities for future grants, coordinated with their advisors.

Why Choose Paramount Impact for Real Estate Donations?

Paramount Impact, with its 501(c)(3) status (EIN: 99-3609530), is uniquely positioned to accept real estate donations:

Flexible Options: Donate to a DAF, fund a fiscal sponsorship, or support our programs, tailored to your goals.
Mission-Driven: Your gift supports impactful initiatives, such as empowering underserved communities or advancing education.
Expert Collaboration: We work with your professional advisors to integrate the donation into your financial and legacy plans, ensuring tax efficiency and alignment with your vision.
Streamlined Process: Our team handles compliance and provides guidance, making the process straightforward.
Donor Portal: Manage your giving through our intuitive portal, tracking grants and expenses in real time.

Frequently Asked Questions

How can donated real estate be used? It can fund a DAF, support a fiscally sponsored project, or contribute to Paramount Impact’s programs, either directly or via sale proceeds.
Do I need to pay for the appraisal? Yes, donors are responsible for appraisal costs to ensure Paramount Impact receives a copy for IRS compliance.
Can I donate property with a mortgage? Properties with debt may be considered, but significant encumbrances may limit acceptance due to financial risk.
Who covers closing costs? Donors are responsible for closing costs, such as title fees, to complete the transfer.
Can I recommend how proceeds are used? For DAFs, you can recommend grants to qualified charities; for fiscal sponsorships or programs, funds support the designated mission.

Get Started Today

Ready to make a transformative impact with a real estate donation? Contact Paramount Impact directly by calling (480) 608-3000 or emailing team@paramountimpact.org to discuss your property and start the process. Our team will guide you and your advisors through every step, ensuring your gift supports our mission, your DAF, or a fiscally sponsored project, creating a lasting legacy.