[WSBARP] Thoughts from the List Serve

[Brent Williams-Ruth]

I have helped several HNW individuals create charitable organizations.  I
am not, however, a tax attorney and always did this with a qualified CPA by
my side.  I am sorry that your client finds herself in this position.

What I can share from those experiences was that there were multiple dire
warnings about putting things into the 501(c)(3) as the rules for wrapping
up the organization are that generally the 501(c)(3) organizations must use
their assets to further their charitable purpose and, if they cease
operations, distribute any remaining assets to another qualified charitable
organization, not to individuals associated with the organization. If the
Exec Director purchases the asset from the entity - that would be
different. But I read your term "transfer" to ostensibly mean "give away"

I would strongly encourage you to work with a qualified tax adviser who
specializes in the world of non-profit entities.

Best of luck to them!
Brent

*Brent Williams-Ruth* (pronouns: he/him)
*Attorney-At-Law*

*Law Offices of Brent Williams-Ruth, **a division of BWR Consulting, PLLC*

*Physical Address: 500 S 336th Street, Suite 214; Federal Way, WA 98003*

*Mailing Address: **PO BOX 3319; Federal Way, WA 98063 *

Office/Scheduling Phone: (253) 285-7751

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On Thu, Jun 26, 2025 at 6:17 PM laj-laws at juno.com <laj-laws at juno.com> wrote:

>
> I  would like input/assistance regarding whether there are negative
> consequences
> (tax or otherwise) if a 501(c)(3) entity (which is an LLC) (“Entity”)
> transfers its real property
> to the Executive Director personally (the Exec. Director and her now
> deceased husband
> were the ones who initially put the real property into the LLC).
>
> The real property taxes are “eating her up” with recent assessments, and
> she’s been told
> that if she transfers the property into her name, personally, then,
> because of her limited income,
> she’d be entitled to a substantial reduction in her annual property taxes.
>
> Any thoughts, pitfalls to be aware of?
>
> Thank you in advance for your assistance,
> Larry
>
>
> LARRY A. JOHNSTONE, ATTORNEY AT LAW, PLLC
> Waterfront Park Building
> 144 Railroad Avenue, Suite 203
> Edmonds, WA 98020
> Phone: (425) 774-LAWS (-5297)
> Email: LAJ-LAWS at juno.com (Best way to reach our Office)
>
>
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