Patents, oil and gas royalties, music royalties, copyrights, and similar assets are termed "intangible personal property." Most of these assets, also known as "passive investments," require limited maintenance but can provide a substantial stream of income to the Church or one of its institutions to help build the kingdom. If there is a market for the underlying asset, it may be sold to provide immediate benefit to the receiving institution rather than relying on the income stream.

The typical donor:

			Has owned the asset for at least one year.
			Gives his or her entire interest in the asset.
			Does not currently need the income stream.
			Wants to make a significant gift to charity.

Gift features and benefits:

			Immediate income tax deduction
			Avoidance of capital gains taxes
			Deduction based on fair market value, if the donor is not the creator
			Gift can be timed to take advantage of changes in market value

How Do I Make a Gift of a Patent, Royalty, or Copyright?
Gifts of patents, copyrights, royalties, and other intangible personal property can be transferred to the Church or one of its institutions. For tax purposes, you must obtain your own appraisal from a qualified appraiser, based on the type of asset given, to determine the fair market value you claim on your income tax return. Your tax return must include IRS form 8283 signed by your appraiser. An appropriate deed of gift form to transfer ownership must be properly completed and delivered to LDS Philanthropies along with other pertinent documents.

Other Facts You Should Know about Patents, Royalties, and Copyrights
The transfer of patents, copyrights, royalties, and other intangible personal property can be complex. You should involve your financial or professional advisors in making a gift of this type of asset. LDS Philanthropies's professional staff will be happy to work with you and your advisors.

A patent is a document giving the right to produce, sell, or receive profit from a process or an invention. The term of the patent is effective for a number of years. A patent held by an inventor or a transferor is considered a capital asset. It is necessary to appraise a patent to determine its fair market value. As long as the full interest is transferred to the Church or one of its institutions, your income tax deduction is based on the full fair market value. Values are determined based on the anticipated income stream from the patent. It is important to complete the appropriate steps and documentation to complete a gift transfer.

A copyright is the exclusive ownership rights to a musical, dramatic, literary, or other artistic work. The copyright provides its owner with the right to receive, or to license to others, income from production, publication, or sale of the copyright for a period of years. Any work that is copyrighted consists of two elements: the copyright and the underlying work. Both need to be gifted to obtain a charitable income tax deduction. Separately, either element will result in a gift of a "partial interest," which will not qualify for a charitable income tax deduction. For purposes of estate tax deduction, the fair market value of either element can be used. Copyrights may be treated either as ordinary income or a capital asset. Consult with your professional advisors and LDS Foundation.

A royalty is the right to receive a portion of the income from or share in the profits generated by a copyright, patent, or other similar asset. When giving a royalty, it is important to transfer the underlying asset; otherwise "partial interest rules" (see "copyright" section above) will apply. If both the royalty interest and the underlying asset are transferred, you may deduct the fair market value as determined by a qualified appraiser. Royalties may be treated either as ordinary income or a capital asset. Consult with your professional advisors and LDS Philanthropies.

Oil and Gas Interests can have significant value. Giving these interests may be somewhat complicated, and you should involve your professional advisors. LDS Philanthropies professional staff members can work with your advisors and coordinate acceptance by the Church's oil and gas specialists.