In Ltr. Rul. In 8711038, the service decided privately that a „personal residence“ could include an apartment for rent. The facts of that case state that the taxpayer has leased part of the property to an unrelated third party. In its analysis, the service cited Rev. Mr. Rul. 78-303, which assumed that a farmer whose farm was leased to an unrelated third party could deduct, as a charitable contribution, a gift that was not faithful to a tax-exempt educational organization, from an irrevocably residual interest in a portion of the leased area in which the farmer retained a benefit. The service did not address the issue of whether the partially usable use by the donor was essential to the donor`s decision; However, since the service has decided that a farm rented in its entirety is qualified, the same logic should apply to a personal residence. In the absence of regulations prohibiting the tenant from renting a personal dwelling for the duration of his property, it also seems logical that the transfer of a personal dwelling, which is rented in its entirety at the time of the gift, can be taken into account. However, the authors are not aware of any decisions that support this hypothesis. See also Ltr.
Rul. 8225158 In many cases, a person`s personal residence or farm is an essential part of an individual`s estate. Similarly, ideal candidates for life real estate contracts are retired, may have modest incomes and need or want additional income. Can a donor prevent the recognition of a taxable transfer to a non-marital tenant by reserving the power of the donation contract to revoke his interests and thus render the transfer for tax purposes for donations incomplete? Mr. and Mrs. Jones entrusted a residual interest to his personal residence on January 1, 1998. The agreement is measured by the length of its extended life or a period of twenty years. In a traditional life court contract, the donor contributes to all the rest of the interest in the property for charitable purposes. However, the donor is not required to do so. In addition, a potential donor may offer to sell a portion of the remaining portion associated with a contribution from the remaining portion. In such cases, the charity may offer payments in the form of cash, a missed note or a charitable pension (if available). Essentially, the concept is a sophisticated form of selling good business27 If part of the property is subject to exhaustion, wear or tear, a particular factor is used to assess the remaining interest in that portion.
When part of the land is subject to depletion of its natural resources, this depletion is taken into account in determining the present value of the remaining interest. Amortization and depletion are calculated according to the straight line method on the usefulness of the asset.6 Rev. Mr. Rul. 75-420 an individual gave a large holiday property to a local university. In the deed of donation, the donor retained the right to life 1) to the free and exclusive use of the property each year from August 1 to September 15; and 2) to store personal belongings at any time of the year in the storage area of the main house on the ground. The deed of donation also prevented the college from transmitting the property until the donor`s death or ten years after the execution of the deed of donation, as is the case later.