Retained Life Estates
(Complete gift description)

With the children grown, you may be thinking that within a few years you won't be using the cabin anymore. Or, perhaps you're considering a permanent move to a warmer client — but want to test the waters first. You are looking for a flexible plan that protects you against uncertainty.

A retained life estate allows you to donate your personal residence (such as a home, cabin, or farm) while retaining the right to live on and use the property. When you make the gift, you retain the right to use the property for the rest of your life, a term of years, or a combination of the two. In exchange for your remainder interest gift, you receive an immediate income tax deduction.

This creative gift plan transfers your house to Pomona College but reserves a free lifetime tenancy to you. You can make a significant gift to Pomona College with the most valuable asset you hold, yet not disturb your living arrangements or your cash flow.

How does a retained life estate work?

You deed the residence to Pomona College, reserving a life tenancy for yourself.

You will continue to be responsible for the house's ongoing taxes, structural maintenance and upkeep. Also, we mutually agree up front about what we will do if you no longer wish to live in the house after you have donated it to Pomona College, or if you become physically unable to continue living there. Your gift will provide you with a charitable income tax deduction, based on the fair market value of your house minus the present value of the life tenancy you have retained.

Planning points

• First, as with all gifts of real estate, we must review and approve the transfer.
• You will need to secure an independent appraisal of your home to establish its value for the deduction.
• And finally, if there is a mortgage or lien on your home, it will complicate the transfer to us and could result in taxable income to you.

Our office can advise you on all these matters.

How do the numbers work?

Obviously, your exact benefits will depend on the value of property you are contributing, its condition, your age, and other market factors. However, we provided an example to give you a better sense of the benefits of a retained life estate.

For more information

Email us, complete the personal illustration form, or call us at (909) 621-8143 or (800) 761-9899 so that we can assist you through every step of the process.

Pomona College
Trusts and Estates
550 North College Ave
Alexander Hall 235
Claremont, CA 91711
(909) 621-8143 or (800) 761-9899
Fax: (909) 621-8654
pomonaplan@pomona.edu