Donate Land or a Home to VHH

Gifts of real estate can allow a property owner to transform a valuable asset into a lasting community benefit, helping provide permanently affordable homes for local families, workers, seniors, and others who contribute to the island’s vitality. Depending on the property and the donor’s circumstances, Vashon HouseHold may be able to accept gifts of vacant land, existing homes, development property, or other real estate that can support the organization’s mission.

In addition to the community impact, donating real estate may offer significant financial benefits. Property owners who donate appreciated real estate to a qualified nonprofit organization may be eligible for a federal charitable income tax deduction based on the property's fair market value and may avoid some or all federal capital gains taxes that could otherwise be due if the property were sold. Washington State also provides certain charitable deductions related to its capital gains tax for qualifying donations to Washington-based nonprofit organizations.

Many owners consider their estate plan the best place to set up a transformational gift to Vashon HouseHold. Donating assets through your will or living trust or by designating the Community Land Trust (Vashon HouseHold) as beneficiary of your retirement account or life insurance can allow you and/or your heirs to avoid paying estate and/or income taxes on those assets. While the impact is less immediate, planned gifts like these are essential to our long-term goal of preserving affordable housing on Vashon.

A bargain sale allows a property owner to support Vashon HouseHold's mission while also receiving financial value from their property. In a bargain sale, a home or parcel of land is sold to Vashon HouseHold for less than its fair market value. The difference between the property's appraised value and the sale price is considered a charitable contribution, helping create permanently affordable housing opportunities for the Vashon community. This approach can be especially attractive for property owners who would like to realize some of their property's value while also making a significant philanthropic impact.

A bargain sale may provide several financial advantages. Because part of the transaction is treated as a charitable gift, the donor may be eligible for a federal income tax deduction based on the donated portion of the property's value. In addition, only the portion of the property that is sold is generally subject to capital gains tax calculations, potentially reducing the overall tax burden compared to a traditional market sale. A bargain sale can also be a useful estate-planning and legacy-giving tool, allowing property owners to support affordable housing while meeting personal financial goals.

The homeowner sells the “remainder interest” to VHH, but continues to live there for an agreed upon period of time, which could be for the rest of the owner’s life. VHH pays the owner the value of the remainder interest, determined by an appraisal of the “fair market value” and an IRS formula for the value of the RLE. If you agree to transfer the property at a price below fair market value, you can get a tax deduction for the difference.

RLE is a good option for homeowners who want to continue to live in their house for either the short- or long-term, and need some cash in the meantime. This option can be better than a reverse mortgage — which is laden with fees and can result in transfer of your home to a bank or mortgage lender rather than your CLT.

A Housing Easement Home is a voluntary way for homeowners to help preserve affordable housing for local residents. Through this model, a homeowner agrees to place a deed restriction, or housing easement, on their property that limits certain uses of the home—such as short-term rentals or speculative resale—and ensures the home remains available to full-time community residents. In exchange, the home is sold at a price below its full market value, creating a more affordable homeownership opportunity for local households. The difference between the market value and the reduced sale price is treated as a charitable donation that supports long-term community housing goals.

For a community land trust, housing easements are a powerful tool for protecting existing homes from being lost to rising market pressures. Rather than building new housing, the program helps conserve homes that already exist and keeps them available for future generations of local residents. The community land trust retains an equity interest and certain rights that help ensure the home continues to serve its intended purpose over time. This approach creates lasting affordability, supports workforce and middle-income housing, and strengthens the long-term stability of the community by keeping more homes occupied by people who live and work locally.