Donate Your House and Keep Living There

Updated August 3, 2026. Quick answer: you can deed your house to charity, keep the right to live in it for the rest of your life, and take a charitable deduction now. This is a genuine and narrow exception to a rule that otherwise denies deductions for gifts of partial interests — and the exception covers a personal residence or a farm, not property generally.

The rule this is an exception to

In the case of a contribution (not made by a transfer in trust) of an interest in property which consists of less than the taxpayer’s entire interest in such property, a deduction shall be allowed under this section only to the extent that the value of the interest contributed would be allowable as a deduction under this section if such interest had been transferred in trust.

— 26 U.S.C. §170(f)(3)(A)

In plain terms: normally, giving away part of something to charity gets you nothing. That is what makes the next provision worth knowing.

Subparagraph (A) shall not apply to— (i) a contribution of a remainder interest in a personal residence or farm, (ii) a contribution of an undivided portion of the taxpayer’s entire interest in property, and (iii) a qualified conservation contribution.

— 26 U.S.C. §170(f)(3)(B) (subsections joined for readability; no words added)

Note how narrow (i) is. A remainder interest in a personal residence or farm. Not a rental building, not a share portfolio, not a commercial property. The other two exceptions listed alongside it are different things entirely and do not widen it.

How it works in practice

1. You deed the remainder interest to the charity and reserve a life estate for yourself.
2. You keep living there. You generally remain responsible for the things an owner is responsible for — maintenance, taxes, insurance — and the agreement should say so explicitly.
3. You take a charitable deduction now for the present value of the remainder.
4. On your death the charity’s interest becomes possessory without probate.

This is not the family life-estate deed

The same words describe a completely different instrument when the remainder goes to a child rather than a charity. That version is about keeping a step-up in basis and avoiding probate; there is no deduction, and the tax analysis is not the same.

The family life-estate deed — the version where the remainder goes to a child

Conflating the two is the most common error in this area. If someone offers you “a life estate deed”, the first question is who holds the remainder, because that determines everything else.

What can go wrong

• It is irrevocable. If you later want to sell and move, you now need the charity’s cooperation, and you are negotiating with a party that already owns the remainder.
• Maintenance obligations outlive your ability to meet them. A written agreement about who pays for a new roof at 92 is worth having at 72.
• It complicates borrowing against the home.
• The deduction depends on IRS actuarial factors and is not the value of the house.

Where a farm is involved

The exception names farms explicitly, which matters where the ground is the estate. The interaction with farm succession planning is its own subject: passing down the farm.

Honest gaps

The statute does not define “personal residence” or “farm” in this subsection, and we have not chased those definitions through the regulations — if your property is unusual, that is the first thing to check. Deduction valuation, depreciation adjustments for a farm, and state deed requirements are all beyond this page.

General information drawn from the Internal Revenue Code, Treasury regulations, IRS publications and the relevant state statutes, not legal or tax advice. Dollar figures are adjusted regularly and the state-law half differs from state to state, so check the current year and your own state before you act on a number.