When charity begins at home
Written by Jeanne Thorne
By all accounts she had a definite presence in the
neighborhood. We are told how she would walk her borzoi
hounds around the historic 7th Avenue district. She
was elegant and creative when she and her husband moved
into the neighborhood in the late 1950s. Both were artists.
As the years passed, time inevitably took its toll.
Her husband died and in her later years, she too suffered
from ill health. There were, apparently, no relatives
and when she drew up her estate she thought of her neighbors
and a charity, the Salvation Army. When she died, six
neighbors shared in her estate, but the home was donated
to the Salvation Army, primarily because the owner was
impressed by the non-profit organization's quick response
Since the organization is not in the business of real
estate, a gift like this home needed to be sold. Noting
the sign, Realtor Sonja Leonard Leonard, owner/broker
of Leonard Leonard & Associates, who lives in the
district and services real estate throughout the Capitol
Hill area with a special interest, inquired of the Salvation
Army how they were pricing the home. They had priced
it at $190,000.
The sale of this home in
the 7th Avenue Historic District touched more lives
and will continue to have an impact on the larger community
due to having been donated to a charity.
Leonard asked to work on the sale and promised to price
the home at a more realistic market value. She would
waive her commission and work on the project without
The property was a valuable one. The home was built
in 1907, a two-story brick described as a Georgetown-style
townhome of approximately 1,740 square feet.In a very
attractive area of stately homes, large trees, it is
within walking distance of the Botanical Gardens, Cheesman
Park, and the Cherry Creek Shopping Center.
But, according to Leonard, the home needed some repair
and updating because the owner had been ill for some
time. Because it had been donated to charity, it also
offered a chance to market the home in some unique ways.
Leonard decided to hold a series of open houses. Local
television and other media were contacted. The sale
would be done by a closed bid procedure. (The asking
price on a prepared brochure was listed at $230,000.
"People came from all over to see the house,"
said Leonard, "some from as far away as Pueblo
and Fort Collins. At an open house some people who had
grown up in the house came back to visit and saw a mural
on the basement wall that they had painted." Some
who came to view the property were also thinking of
donating property to a charity of their choice and wanted
more information about the capital gains aspect.
"We all worked to generate the energy...the hype...for
this sale," said Leonard. "All totaled we
had about 400 people at the open houses. It was shown
on television and another open house was by invitation
only. When I listed it in Multi list I specifically
said that there would be no commission paid on this
sale, but other Realtors did show an interest in the
property, even without the commission!" In addition
to Leonard's pro bono work, others also volunteered
their services. Land Title did the title work and closing
for free. Stan Dexter of Metro Mortgage Consulting offered
a "free loan" if needed. Neighborhood teenagers
shoveled the walks and kept them clear of snow and ice.
They also volunteered to serve refreshments at the open
houses. Younger neighborhood children, who had established
a clubhouse in the greenhouse, watered the plants and
garden. Leonard has an assortment of letters, framed
in her office, addressed to the departed owner by these
children and left on the front porch. (One says "good-by
Ultimately, 11 sealed bids were received and the opening
of those bids (filmed by KCNC-TV Channel 4) was quite
an occasion. The bids ranged from $180,000 to a high
of $242,000, with an average being $210,000 establishing
this as the market value for tax purposes. Five offers
were above the asking price. The winning bid was submitted
by a young couple who were thrilled to be buying a valuable,
historic property and making a donation to a worthy
cause at the same time.
For people who have an estate that will be impacted
by capital gains taxes ($600,000 and above), donating
a property to charity is an option worth exploring.
Especially if one has no surviving relatives, or if
the children show no interest in the property. Otherwise,
your property could go to the state.
We spoke with George Buckley, director of the planned
giving department with the Salvation Army to find out
more about how donations like this can be made.
There are two ways of setting up a charitable trust
with the Salvation Army, he said. One is a Life Estate,
whereby the home is given to the charity upon a person's
demise. But until that happens, the person may live
in the home, maintaining it and paying for upkeep, etc.
The Internal Revenue Service will allow a charitable
deduction up front or it can be spread out over a period
of six years. When the person dies, the charity immediately
takes over and the home will not have to go through
Another option is the Charitable Annuity or Uniti-Trust.
With this option, the charity would sell the house and
avoid capital gains (28% federal, plus 5% state). The
income from the trust would go to the donor for the
rest of their life and they could take the charitable
deduction for up to six years. The difference between
the Annuity and the Uniti-Trust is interest earned.
The Annuity is a fixed-amount, while the other might
Stocks and bonds can also be put in charitable trusts
You should discuss these options with your lawyer and
tax consultant and Buckley will be happy to give you
more information concerning donating property to charities.
Everyone connected to this sale benefited. The neighborhood
felt especially close. The response from the Realtor
community was gratifying. Certainly the Salvation Army
benefited and the money raised will stay in the Denver
area to help those in need. The new owners are happy
to have the property. And Leonard Leonard was happy
to give something back to her community. "But...the
owner really started this process..." said Leonard
with a smile. "She was a classy lady."
Buckley can be reached at 861-4833 or 1-800-999-1865.
Leonard Leonard & Associates can be reached at 744-6200.
©1996 By Leonard Leonard &
Associates, Inc. All rights reserved. Duplication in
whole or in part without permission is prohibited.