February 28, 2024

GIFTS IN KIND

The Triple Win for Donors, Institutions & Students

By Carmen Greger

You’ve heard of donating money, but what about donating a piece of art, a building, or even intellectual property? Welcome to the world of ‘Gifts in Kind’. If you’re an alumnus or simply someone passionate about education, this concept offers an unparalleled opportunity to make a lasting impact on a college or university.

And guess what? Institutions are eager, willing, and equipped to accept these gifts. But why should you consider this avenue of giving? Because it’s a win-win-win for the donor, the institution, and the students. Let’s dive in.

What are Gifts in Kind?

At its core, a gift in kind is a type of donation where, instead of giving money to buy needed goods and services, the goods and services themselves are given. These can range from tangible assets like real estate and artworks, to intangible assets like patents and copyrights.

A Mutual Benefit: The Triple Win

  • For the Donor: The immediate benefit is a potential tax write-off. According to the IRS, when properly documented, the donation of assets can provide significant tax advantages, sometimes even more beneficial than a cash donation. Beyond the fiscal benefits, there’s the personal satisfaction of making a profound difference in an educational community you value.
  • For the Institution: Colleges and universities often face budget constraints. Gifts in kind can relieve some of these pressures, allowing them to allocate funds elsewhere. Moreover, certain gifts, like artworks or historical artifacts, can elevate the institution’s prestige.
  • For the Students: These donations can directly or indirectly enrich the student experience. Imagine studying in a building donated by an alumnus or having access to cutting-edge technology thanks to a generous gift in kind.

The Logistics

While the idea sounds attractive, there are some specifics to consider:

  • Valuation: The IRS requires an independent appraisal for gifts in kind valued over $5,000. This ensures that both the donor receives a fair tax write-off and the institution recognizes the correct value.
  • Acceptance: Not all gifts in kind are automatically accepted. Institutions usually have policies to ensure the donation aligns with their mission and needs.
  • Stewardship: The institution often takes responsibility for maintaining or preserving the donation, be it artwork, real estate, or otherwise.

A World of Possibilities

Gifts in kind are diverse. Here are a few examples:

  • Real Estate: In 2013, UCLA received a gift of a residential building worth $7.7 million.
  • Art: Yale University was once gifted Vincent van Gogh’s “The Night Café,” now a cornerstone of their art collection.
  • Intellectual Property: Patents and copyrights can be gifted, allowing institutions to profit from royalties.

Famous Alumni Donations

Consider the likes of Bill and Melinda Gates, who have donated millions in software to various institutions, or Nike co-founder Phil Knight’s monumental gifts to Stanford and the University of Oregon. Such gifts don’t just elevate the university’s stature; they inspire the next generation of students.

Alumni: The Eternal Benefactors

A survey by CASE found that alumni are responsible for over 26% of all donations to colleges and universities. The reason? A blend of gratitude, nostalgia, and the desire to give back to an institution that once gave them so much.

Make A Difference

Gifts in Kind offer a unique opportunity for donors to make a lasting difference. The act of giving goes beyond monetary value, creating legacies and memories that last for generations. As Benjamin Franklin aptly said, “An investment in knowledge pays the best interest.”

So, the next time you consider making a donation, remember that your alma mater might just welcome that old painting, patent, or piece of property with open arms. And in doing so, you’re not just helping an institution; you’re changing lives.

Take Action

Consider a gift in kind today. Whether it’s a treasured artwork, valuable real estate, a sum of money, or an innovative patent, your gift can make a world of difference. Think about your legacy. What will you leave behind?