Category Archive: Planned Giving
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Homeowner wants to make sure Heathside Cottage will outlive her
By Gretchen McKay,
Post-Gazette Staff Writer
Saturday, July 12, 2003Anyone who’s ever fixed up a neglected old house knows it takes more than time and money. It takes some of your soul.
Judith Harvey in the “urban garden” at her Fineview home. She restored the dilapidated Gothic Revival cottage then bought the abandoned house next door, had it torn down and created the garden. (Robin Rombach, Post-Gazette)
Just ask Judith Harvey. She spent close to five years restoring Heathside Cottage, a six-room Gothic Revival cottage in the North Side’s Fineview neighborhood. Snow White herself would feel at home within its rounded walls and fanciful gingerbread trim.
“Some houses talk to you,” says Harvey with a delicate shrug of her shoulders. “I knew the moment I saw its chimney from the street up above that I had to have it.”
What one person loves, however, another might surrender to the wrecking ball. So soon after the meticulous restoration was complete, the former librarian began worrying about her tiny house’s future. What would happen when she was gone?
“It really troubled me,” she recalls. “It was important that I find a way to protect it.”
A member of the Pittsburgh History & Landmarks Foundation, Harvey said her first thought was to simply leave it in her will to the historic preservation group. It didn’t matter if it used it as an art gallery or a study; all she wanted was peace of mind that her 165-year-old house — which is listed on the National Register of Historic Places and bears a Landmarks plaque — would survive intact for years to come.
But while gifts of property provide Landmarks with much-needed cash to support its mission, “we’re not in the real estate business,” says Jack Miller, director of gift planning. Besides, even though Landmarks would get the proceeds from the eventual sale of the house, buyers would be able to do anything they wanted with the property. So he suggested protecting it first, then making a “retained life estate” gift.
Here’s how it works: Harvey granted a facade easement to Landmarks that guarantees no one could ever change the exterior of the house. She then deeded the house to the foundation but retained the right to live in or rent it for the rest of her life. She would also be responsible for property taxes and maintenance.
Heathside Cottage sits on Caroma Street in Fineview. Owner Judith Harvey is making sure that the house and all the work she put into restoring it will outlive her by making a “retained life estate gift” of the property to Pittsburgh History & Landmarks Foundation. (Robin Rombach, Post-Gazette)
“Nothing changes until the day she dies,” Miller says.
But what about taxes? Harvey is entitled to a charitable income tax deduction. Also, the property is no longer part of an estate that could be attached — by a nursing home, for instance — if Harvey could no longer care for herself. The best part, however, is that Harvey’s home and handiwork will be preserved for future generations.
Built around 1855 by bridge engineer James Andrews, the brick cottage is so unusual that it was featured in Rick Sebak’s 1997 documentary “North Side Story.” It is a model of Early Victorian design, with lacy bargeboard, a steeply pitched roof and diamond-paned sash windows. And its location on a hilly outcrop gives it a mighty fine view of Downtown, hence the neighborhood’s name.
Harvey bought the dilapidated house in 1992 as a weekend “playhouse,” then moved in permanently after her husband died in 1996. She also purchased the abandoned house next door and then had it torn down to create an urban garden (the stone foundation serves as a wall).
The largest rooms in the two-story cottage measure just 14 feet square, though the 11 1/2-foot ceilings on the first floor –many with beautiful wallpaper — lend an airy feel. Antiques and collectibles reflect Harvey’s love for anything old.
But there are some modern touches, as well. A large mirror above the mantel in the “futon” room is an inspired background for several smaller mirrors; Harvey herself designed the dining room’s enormous rosewood sideboard, which was handmade in Pakistan.
A narrow staircase leads to the light-filled second floor. Here, slanted walls and a whimsical diamond-shaped window in the bedroom (it’s held up by a chain attached to a hook) add to the cottage’s storybook feel. A slender, pointed “lancet” window in the bedroom-turned-closet room reminds visitors of the home’s Gothic roots. Harvey couldn’t bear to think of it in ruins.
“It’s protected as much as it can be,” she says. “It’s where people can see history and be a part of it.”
“Judith obviously cared very much about the property, so it worked out well,” says Miller.
Many people are not aware that they can give their house or farm — or in the case of one donor, a pizza manufacturing plant — to a charitable organization.
Miller says such “planned gifts” work best for people who want to do something for the community and, in some cases, receive income from an asset that is not normally an income-producing property. With a planned gift, donors find that they are able to contribute more than they thought possible while still providing for their family. Miller is quick to note that no one should enter into one of these agreements without the advice of a lawyer and/or financial consultant or accountant.
Harvey’s retained life estate gift of Heathside Cottage, the first gift of its kind to Landmarks, is only one way to go, Miller says. A charitable gift annuity, for instance, allows someone to give a gift of property in exchange for fixed income payments for life that are based on the age and number of beneficiaries. An added benefit is an upfront tax deduction.
A charitable remainder trust, by way of contrast, permits someone to transfer a property to a trust, avoid capital-gains tax and receive a fixed or variable payment each year for up to 20 years or the lifetime of the income beneficiary. Like the annuity, the gift also carries a federal income tax deduction for the donor.
Lucille Tooke chose the charitable remainder trust option when she donated her historic property, Hidden Valley Farm in Pine, to Landmarks in 2001.
Tooke and her husband, Jack, bought the farm in 1954 and spent the next 40 years raising their three daughters on its 64 acres. After Jack died in 1993, it became increasingly difficult for Tooke to take care of it on her own.
“It got to be more than I could handle,” says Tooke, a longtime Landmarks member who now lives in Chambersburg, Franklin County.
So in 2000, she asked Landmarks officials if they knew anyone who might be interested in buying and preserving the property. Most of the land surrounding the farm, which was built in 1835 by Lewis Ross and his wife, Temperance, had already been developed. The thought that it, too, might one day become part of the ‘burbs “made me shudder,” says Tooke.
Unlike Harvey, Tooke was ready to sell the house so she could move closer to her daughters. However, she also needed an income to meet living expenses. Landmarks helped her work out a plan.
She avoided capital-gains tax by turning the farm over to the trust and received a charitable deduction for a portion of the property’s value and a percentage of the trust’s value each year.
When the trust put the farm up for sale, Landmarks had the right to match the highest bid and ended up buying it.
Before reselling it, Landmarks added deed restrictions that required owners to get prior approval from Landmarks before altering the house’s exterior. They also stipulated that the land could not be subdivided or used for non-agricultural commercial purposes.
Even though the restrictions lowered the selling price and made it more difficult to find a buyer, it helped preserve a historic landmark.
“The land and building will be there forever,” says Miller. “And one day, when urban sprawl takes over, the public will be able to see what an early 19th-century farm looked like.”
OK, you’re thinking, a property has to be of historical or architectural significance for Landmarks to be interested in it. Not so. Mary Ann and Tony Kopczynski recently donated the buildings that housed their pizza manufacturing business in McKees Rocks in the form of a charitable gift annuity. In exchange for the 5,000-square-foot warehouse and adjoining office building, the couple receive fixed annual payments for as long as they live.
They also got a sizable federal charitable income tax deduction for the gift portion of the property transfer.
“It gave them an opportunity to retire without having to worry about selling the property,” says Miller.
For more information on the Pittsburgh History & Landmarks Foundation’s Planned Giving Program, visit http://plannedgifts.phlf.org/or call Jack Miller at 412-471-5808, ext. 538.
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A Gift With A View
Journal of Gift Planning –
3rd Quarter 2002The cover image depicts Heathside Cottage, listed on the National Register of Historic Places and constructed circa 1855 in what is now Pittsburgh, PA.
The building’s Greek revival style is rare to find with its vergeboard and other sawn-out wooden trim still present and diamond-paned sash still in the windows. The word “heath”- meaning an open area with wild shubbery – is English. It suggests the romantic seclusion this house originally had, looking southward over the then growing City of Allegheny from a vantage point of 400 feet up.
Instead of giving her home via bequest, owner Judith K Harvey granted a facade easemnt to the Pittsburgh History & Landmarks Foundation (Landmarks), then made a retained life estate gift. Her resulting charitable deduction permitted her to offset the income tax owed on assets rolled over from a traditonal IRA to a Roth IRA. Her planning preserved a landmark and enabled her to do it during her lifetime.
All That Glitters is Not Goldby
Landmarks recently accepted an 11-volume collection of dated Pittsburgh cutouts and postcards, donated by member Harry C. Goldby, formerly of Pittsburgh, now residing in Carlisle, PA.
Mr. Goldby’s act of kindness emphasizes that significant gifts don’t have to be cash or securities. When such gifts are related to a charity’s mission, they also qualify for a full market-value charitable income tax deduction.
Generally, Landmarks will not accept a gift of tangible personal property unless its maintenance and care are endowed at the time the gift is made.
Landmarks must also inspect the gift to be sure it relates to our mission and to determine if it meets the conditions of our gift acceptance policy.
Because this collection of historical images of Pittsburgh is invaluable to our research, we were deeply gratified to receive it.
On behalf of all of our members who now have access to this collection in our library, Landmarks thanks Mr. Goldby for finding a way to share a part of Pittsburgh’s past with its future.
Contact: Jack Miller
Director of Gift Planning -
A Home With a Past Becomes a Present
In 1992, Judith Harvey fell in love with a dilapidated historic landmark that would eventually become her home.
After years of restoration, she turned Heathside Cottage into a showplace with the intention of preserving the 1855 Gothic Revival Cottage for the enjoyment of future generations.
To accomplish that goal, in 2000, she placed a façade easement on her National Register listed home then gave it to the Pittsburgh History & Landmarks Foundation while retaining the right to live there for the rest of her life.
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One Gift Annuity to go. . . Hold the Headaches, Double the Income
Tony and Mary Ann Kopczynski never had a lot of money, but for more than a decade they were rolling in dough. That’s because in 1985 the couple purchased and ran Pizza Plus, a small pizza manufacturing business in McKees Rocks.
“For 25 years, I was district sales manager at General Foods,” said Tony. “Then, Phillip Morris bought out the company and gave me the choice of relocating to Cleveland or unemployment. Since we would never leave Pittsburgh, I negotiated a silver parachute.”
At the time, daughter Judy was married and living in Virginia, son Tony was a successful electrical engineer at PPG Industries in Pittsburgh, and the severance package made it possible for the couple to pursue the dream of owning their own business.
Now it just so happened at that time, the family of their son’s friend was thinking about selling its McKees Rocks pizza manufacturing business. Buying the business interested Tony, but Mary Ann was skeptical. So Tony worked at the company for three months without pay to get a feel for the business.
“Originally, I was opposed to the idea,” said Mary Ann, “but we found a good lawyer and CPA who showed us how we could build the business if we were willing to work hard.”
The Kopczynskis welcomed hard work and had business experience. Mary Ann had been a bookkeeper for Allegheny Plywood prior to becoming a fulltime homemaker. Tony knew sales and their son’s knowledge of electrical engineering would prove invaluable in the plant.
With all that going for them, the Kopczynskis decided to buy the business. In a few years, Pizza Plus, competing with national companies, doubled its sales by providing a quality product and excellent service.
When health issues led to retirement, no buyers could be found who shared the Kopczynski’s enthusiasm for their business. That’s when they decided to sell their plant and office building and dissolve the business. Enter Landmarks.
“While the property was not of architectural or historic significance, it met Landmarks’ need for additional storage space,” said Landmarks’ president Arthur Ziegler. “There was also office space we could use or lease.”
Because of the mutual benefits it offers, Landmarks proposed accepting the buildings as gifts to fund a charitable gift annuity. In other words, in return for the property, Landmarks would pay the couple a fixed annual income for as long as either of them lives.
Based on their ages, 6.3% of the value of the Kopczynskis’ gifted property will annually be direct-deposited to their checking account in quarterly payments and they will receive a significant current federal charitable income tax deduction for the gift portion of the property transfer.
So where do the Kopczynski’s go from here?“We’re going to become snowbirds,” said Mary Ann. “We’ll stay in Florida during the winter, then return to Pittsburgh for the rest of the year. We could never totally leave Pittsburgh. We were born here, met here, refused to relocate, and plan to be buried here. We just love this town.”
“I feel good about the gifts we made over the years to support our nonprofit customers,” said Tony. “Now, this gift to Landmarks not only allows us to give something back to the community that gave us so much, but it relieves our stress while providing retirement income.”
Mary Ann added: “Really, Landmarks was the answer to our prayers.”
In short, when it its comes to our donors, Landmarks delivers.
For information on how a planned gift can help you and support Landmarks’ mission, please contact: Jack Miller , Director of Gift Planning at 412-471-5808, ext 538.
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A Historic Gift of a Non-Historic Nature
What motivates a brother and sister to give their childhood home in Lawrenceville to Landmarks? In the case of John Hudak and Katherine Hudak Golobic, it was a way to pay tribute to two loving parents.
John Sr. and Mary Hudak worked hard all of their lives. John was the first of his generation to be born in America. Mary came to this country from Austria when she was 16. Both lived by a strong work ethic.
The couple raised three children: John, Katherine, and Mary Ann. Together they faced the challenges of Mary Ann’s Downe’s Syndrome, periodic layoffs associated with being a welder for U.S. Steel, and having to help staff the parents’ neighborhood grocery store.
But no obstacle could stand in the way of providing for their children. When the grocery store closed, John Sr. worked more overtime at the mill and Mary, then in her forties, enrolled at the Pittsburgh Beauty Academy, graduated at the top of her class and generated extra income from “beautician work.”
Their combined incomes put a son through college and a daughter through nursing school, and enabled Mary Ann to receive the best care possible. When John, Sr. was diagnosed with cancer, Mary cared for him in the only home she ever knew until he died in 1995.
In 2001, cancer also claimed Mary. But her final days were made less painful because Katherine cared for her while John took care of the house and bills.When deciding what to do with the family home after his mother’s death, John consulted Katherine. Since each lived out-of-state, selling the house would be difficult. That was when their Realtor suggested giving Landmarks the Lawrenceville property.
“Giving the house to Landmarks in memory of our parents became a wonderful answer to our dilemma,” said John. “Everyone in the family supported the idea, even our children.”
With the tax savings realized from the gift, John, Jr. and Katherine were also able to direct additional cash to Mary Ann for her long-term care and give something back to the community that meant so much to them and their parents.
PHLF plans to try to restore the exterior of these properties to better reflect their original architectural style.
“When we eventually sell the building to a reputable buyer, we’;; apply the proceeds to an unrestricted endowment account”, said Landmarks’ president Arthur Ziegler. “The gift will then generate income to support our preservation mission in memory of John and Mary Hudak.”
Katherine and John, Jr. hope to call Pittsburgh “home” again one day. But whether or not they return, their generosity has assured that the spirit of the Hudak family will always reside at Landmarks.
Contact: Jack Miller
Director of Gift Planning -
Leveraging Their Legacy
George and Eileen Dorman support a number of community causes, but preservation is at the top of their list.
During the past 20 years, they’ve watched farmland disappear as a population wave moved toward property they own on the tip of Long Island in New York; and they’ve followed the efforts of the late Constance Oliver O’Neil who provided major grants to underwrite Landmarks’ Historic Religious Properties Fund.
As a result of some creative planning, the Dormans have made their own long-term financial commitment to Landmarks that will strengthen our Historic Religious Properties Program and help us to expand our Easement Program.
More than a decade ago, George was elected to the board of a local corporation. As a member of the compensation committee, he championed a Directors’ Charitable Award Program (DCAP). Through this program, he was able to direct payment for his service to an insurance policy that established charities as the beneficiaries.
While on the corporate board, George served on just about every committee, attending as many as 20 meetings per year. Each time, his director’s fee went to the DCAP. When he retired in 2001, a significant sum had been accumulated.
“Eileen and I decided early on that my director’s fees could do a lot more good for the community than for us,” said George. “The only downside was that I had to die or retire before any charitable organization could collect. Fortunately (from my standpoint), retirement came first.”
As a result of the Dormans’ foresight, Landmarks will receive a significant annual gift for each of the next ten years. Eighty percent will be directed to the Historic Religious Properties Fund and the balance will be used to underwrite the Easement Program, particularly those easements that assist in preserving properties for their current use.
“You can go to Europe and see churches that have stood for centuries,” said Eileen. “That glorious architecture and those magnificent stained glass windows give you a sense of the relationship of the builders to their Faith and their God, a relationship that continues to this day.
“George and I wanted to contribute something to that spirit in Pittsburgh. Besides, a building that’s always used never feels old.”
Added George: “Ten years from now, we hope to look back and see architecturally significant churches and historic farms are still here, doing what they were designed to do.”
Thanks to the Dormans and a decision that they made 12 years ago to forego a source of income in favor of a major gift to Landmarks, that wish may just come true.
If you serve on a corporate board, inquire if a Directors’ Charitable Award Program is an option for you. It’s a great way to leave your mark on Pittsburgh and help Landmarks protect the places that make Pittsburgh home.
Contact: Jack Miller
Director of Gift Planning -
Historic Rural Preservation Program Announced
Pittsburgh, Pa. . . . .
On December 11th, 40 farmers attended a meeting at Hidden Valley Farm arranged by the Pittsburgh History & Landmarks Foundation to discuss new and creative tools now available to help preserve Allegheny County farms.
One of those tools included Landmarks’ Historic Rural Preservation Program, which offers a variety of planned gifts that help farmers reduce income, estate and property taxes, while preserving historic farm property.
Also presenting were representatives of the Pennsylvania Department of Agriculture, Allegheny County Conservation District and Allegheny Land Trust. They discussed how development, scenic and conservation easements could be used to provide cash and reduce real estate assessments for farmers being threatened by increasing development and urban sprawl.
“The remaining farmers in Allegheny County have become land rich and cash poor,” said Landmarks’ president Arthur Ziegler. “We want them to know that they have options other than selling their property to developers or losing it to estate taxes.”
Landmarks held the meeting at Hidden Valley Farm to show how an historic farm can be preserved without having a negative financial impact on the owner. The 64-acre 1835 farm was gifted to a charitable remainder trust and eventually purchased by Landmarks.
In return, the donor received significant tax benefits and a 20-year income stream. At the end of that time, Landmarks receives whatever remains in the trust, an amount expected to offset the loss Landmarks’ experienced after making protective façade and scenic easements a condition of its resale.
Now that these farmers know that they have choices, the next step is to meet with them individually to discuss their interests and needs. Though this collaborative effort, it will now be possible to match a variety of preservation tools to meet the specific needs of the individual farmers.
“According to the most recent census statistics, farm acreage in Allegheny County dropped by nearly 35% between 1987 and 1997 and most likely another 20% since then,” said Ziegler. “Our only hope to preserve what’s left is to work together and maximize our resources in meeting these farmers’ needs.”
Contact: Jack Miller
Director of Gift Planning