BuildUp has acquired the proprietary ARROWLIFT FailSafe House Lifting System that will both fast track our "Donate-a-House" program and also create a more affordable option to double up the square footage of your one story home through our innovative "Moving Up" process. If you own or acquire a one story cottage-style home on a basement or crawlspace, both of these two options are worth exploring BEFORE you decide to demolish your house or take the roof off to add a story. The Moving Up process allows (for the first time in the Southeast) home owners to lift their one story house in the air and effectively add a story beneath it, either by adding height to and finishing an up to 12 foot tall basement or by lifting your cottage to the "second story" to build a first floor underneath it, while also stabilizing or repairing your older foundation. Please fill out the form at the bottom of the page to inquire more about this process.
Each potential donor's tax situation is as different and unique as the house they hope to donate. Each home, based on its condition, dimensions (height, width, and length), and positioning on a street or within a neighborhood present a unique set of challenges to moving the house. Additionally, because each donor's income and tax liability shifts from one to another, and even from one year to another, Build UP provides no tax advice and encourages all potential donors to contact a tax professional.
Build UP does NOT suggest that the fictional scenario below works the same for all donors, but the simplified example below describes a potential tax-impact event leveraging our unique program.
Over-The-Mountain House Relocation:
Proposed House Donation - 3 bedroom, 2 bath, approximately 1,400 sq ft house built in 1968
*Assumes donors are married filing jointly with no other itemized or charitable deductions for the sake of simplicity
**Houses owned less than one year qualify as short-term assets and receive different treatment in a few nuanced ways
Property owners are looking to build a new house on their property in place of the home they have lived in and owned for the past ten years. The existing house was built in the late 1960's, but has been well cared for and updated several times over the years. Typically, owners are faced with the decision to pay a contractor anywhere from $20-$30K in demolition costs to get "down to the dirt." However, Birmingham area residents have access to our unique home donation and relocation program. After contacting Build UP, an appraiser appraises the property to be valued at $625K, $225K of which is in the value of the house structure itself, leaving the land's value at $400K.
The homeowner's projected combined adjusted gross income (AGI) is $500,000, which puts them at a 35% Federal tax rate. This situation would incur an $175,000 IRS tax burden and approximately $24,750 owed to the state of Alabama, making the couple's total tax burden, much of which was already paid in throughout the year, nearly $200,000.
However, since they are now donating the home to a 501(c)(3) tax-exempt (non-profit) organization, with no other charitable gifts for the year, they would be looking at the following scenario: their AGI becomes $275,000 dropping them down to the 24% Federal tax rate, and their tax burden now becomes: IRS- $66,000 and Montgomery- $13,500 for a total of $79,500. This entails a likely tax refund in the spring of more than $100,000. If the couple's AGI is higher, the savings are likely even greater. If AGI is lower, then the couple would likely carry over the tax deduction into the following year(s).
Because they have benefited financially by this unique opportunity, the property owner generously pledges to make a $70,000 cash donation to Build UP, a legally distinct non-profit whose charitable purpose is to help rebuild communities and educate area youth. The couple is able to also use this cash contribution as an additional charitable donation (for that year or carried over to the next), just the same as tithing to a church, and they still feel great about their financial position.
Everyone wins. Build UP students, families, and the Birmingham community now have a quality starter home to help end generational poverty and rebuild the neighborhood. The homeowners have benefited financially by donating the home and even supporting a school with a cash donation. The environment wins by keeping a quality home from a landfill. Let us partner with YOU!
Build UP does NOT suggest that the fictional scenario below works the same for all donors, but the simplified example below describes a potential tax-impact event leveraging our unique program.
Over-The-Mountain House Relocation:
Proposed House Donation - 3 bedroom, 2 bath, approximately 1,400 sq ft house built in 1968
*Assumes donors are married filing jointly with no other itemized or charitable deductions for the sake of simplicity
**Houses owned less than one year qualify as short-term assets and receive different treatment in a few nuanced ways
Property owners are looking to build a new house on their property in place of the home they have lived in and owned for the past ten years. The existing house was built in the late 1960's, but has been well cared for and updated several times over the years. Typically, owners are faced with the decision to pay a contractor anywhere from $20-$30K in demolition costs to get "down to the dirt." However, Birmingham area residents have access to our unique home donation and relocation program. After contacting Build UP, an appraiser appraises the property to be valued at $625K, $225K of which is in the value of the house structure itself, leaving the land's value at $400K.
The homeowner's projected combined adjusted gross income (AGI) is $500,000, which puts them at a 35% Federal tax rate. This situation would incur an $175,000 IRS tax burden and approximately $24,750 owed to the state of Alabama, making the couple's total tax burden, much of which was already paid in throughout the year, nearly $200,000.
However, since they are now donating the home to a 501(c)(3) tax-exempt (non-profit) organization, with no other charitable gifts for the year, they would be looking at the following scenario: their AGI becomes $275,000 dropping them down to the 24% Federal tax rate, and their tax burden now becomes: IRS- $66,000 and Montgomery- $13,500 for a total of $79,500. This entails a likely tax refund in the spring of more than $100,000. If the couple's AGI is higher, the savings are likely even greater. If AGI is lower, then the couple would likely carry over the tax deduction into the following year(s).
Because they have benefited financially by this unique opportunity, the property owner generously pledges to make a $70,000 cash donation to Build UP, a legally distinct non-profit whose charitable purpose is to help rebuild communities and educate area youth. The couple is able to also use this cash contribution as an additional charitable donation (for that year or carried over to the next), just the same as tithing to a church, and they still feel great about their financial position.
Everyone wins. Build UP students, families, and the Birmingham community now have a quality starter home to help end generational poverty and rebuild the neighborhood. The homeowners have benefited financially by donating the home and even supporting a school with a cash donation. The environment wins by keeping a quality home from a landfill. Let us partner with YOU!