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Purchase Of Church Property Leads To Donation

Ask the Real Estate Lawyer: Real Estate Law Q&A

REM #LAW 661

By Ilyce R. Glink and Samuel J. Tamkin

Summary: The reader is helping their church purchase a piece of commercial property. They wonder if the seller can reduce the price of the property and consider it a tax deductible donation to the church. Ilyce and Sam feel this deal might work given a willing property seller.

Q: My church is considering purchasing a piece of commercial property and using it for our new church facility.
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The seller has one price in mind. However, we would like to make an offer on the property and allow the seller to make a contribution to the church for a portion of the sales price. This will lower the selling price for us and provide a taxable contribution to the seller.

Can we do this?

A: If you and the seller are in agreement as to price, you can structure the transaction to benefit both the seller and your church. You will, however, need a willing seller who wants to make a contribution to the church. You can’t force someone to make a donation if he isn’t inclined to do so.

Keep in mind that the structure of the transaction must be fair and at arm’s length. If the purchase price is agreed to and the seller wants to make a contribution to the church, you should be fine.

If the church has an attorney, you should consult further with the attorney on what you are planning to do.

Samuel J. Tamkin is a Chicago-based real estate attorney. Ilyce R. Glink’s latest book is 50 Simple Steps You Can Take To Sell Your Home Faster and For More Money In Any Market. If you have questions for them, write: Real Estate Matters Syndicate, PO Box 366, Glencoe, IL 60022 or contact them through Ilyce’s website www.thinkglink.com