The instrument and the country
The concession, trust deed, lease or title, with the term and the expiry date.
Donate foreign property held on a long lease, concession or trust
Foreign leasehold specialists: (888) 228-7320
Donate Foreign Leasehold or Concession Property
In much of the world the beachfront is not for sale. Costa Rica grants concessions in the maritime zone, Mexico holds restricted-zone coastal property through a bank trust, and long ground leases are ordinary in the Caribbean, the Pacific and across Asia. What you hold is a right under a host-country instrument rather than a deed you can simply sign over. Tell us the country and the document, and we will find out what can be done before anything is promised.
Tell us about the property
Every property gets a look. Name, phone and email are the only required fields.
Fully IRS Compliant
We Handle the Paperwork
Form 8283 Done Right
501(c)(3) Recognized Charity
Four instruments, four different answers
A Costa Rican maritime zone concession is granted by the local municipality for a term, renewable, with statutory limits on how much of a concession a foreign national may hold. Mexican coastal and border property in the restricted zone is held by a Mexican bank as trustee under a fideicomiso, with the foreign buyer as beneficiary; the beneficiary interest is what changes hands, subject to the bank’s approval and permit requirements. A long ground lease conveys a term of years from a landlord who keeps the reversion. Leasehold flats in the United Kingdom and elsewhere work the same way.
In every one of those, a third party decides whether a transfer happens: a municipality, a trustee bank, a ground landlord, a registry. That is the first question we ask, and we ask it of them rather than assuming.
The term is the value
A concession or lease with eleven years to run and one with sixty-two are not comparable assets. Whatever the instrument, we need the expiry date early.
What usually happens
Sometimes the grantor approves the charity as holder and the transfer proceeds under local counsel, with local transfer taxes and fees paid as the host country requires. Sometimes it does not, because the instrument restricts who may hold it, or because approval would take longer than the remaining term justifies.
Where a direct transfer is not available, the route that is is usually a sale in the local market with a cash gift of the proceeds to Giving Center, receipted in the ordinary way. That is a real option rather than a consolation, and for property held through a foreign trust or entity it is frequently the cleaner one.
What to have in front of you
Four things, and the first three are on the document itself.
The grantor or trustee
The municipality, the trustee bank or the ground landlord, and any transfer conditions they impose.
Local counsel, if you have any
A notary or lawyer already engaged in that country shortens this considerably.
Questions about foreign property donations
Can a US charity be the beneficiary of a Mexican fideicomiso? +
That is the question we put to the trustee bank at the outset, because the bank and the applicable permit rules decide it, not us. Some will, some will not, and the answer can depend on the state and the bank. We do not draft anything before we have it in writing.
Is a gift of foreign real property deductible on a US return? +
A gift to a US 501(c)(3) is generally evaluated under the same Internal Revenue Code rules wherever the property sits, including the qualified appraisal requirement and Form 8283. Foreign transfer taxes, local fees and the host country’s own rules apply on top, and there may be reporting obligations in both countries. This is a situation to take to an advisor in each jurisdiction, and we will say so every time.
Who pays the local transfer costs? +
It depends on the country and on the numbers, and we will be specific once we know both. Some jurisdictions impose costs heavy enough to change whether a transfer makes sense at all, which is a reason to ask early rather than late.
My property abroad is a timeshare week. Is this the right page? +
No, that is timeshare and fractional donations, whether the resort is in Florida or in Quintana Roo.
How long does a foreign transfer take? +
Longer than a domestic one, and the variable is the grantor rather than us. Concession and trust approvals are measured in months. If you are working against a year-end deadline, tell us on the first call so we can say honestly whether it is achievable.
We do not provide tax or legal advice. See IRS Publication 526, Publication 561 and the Form 8283 instructions, and consult your own advisor.
Related guides
Tell us the country and the instrument and we will find out
A photograph of the document and the expiry date are enough to start.