Bargain and Sale

Deed in the form of a contract that conveys property and transfers title to the buyer but lacks any guarantee from the seller as to the validity of the title. It is commonly used today to convey title to real estate and in effect transfers to the new owner whatever interest the grantor had. See also Quitclaim Deed; Warranty Deed.

Charitable planning strategy in which a donor sells an asset to the charity for an amount less than its fair market value. Internal Revenue Service regulations require that the tax basis for the property be established on a pro rata schedule between the sale portion and the gift portion. The donor has a taxable gain on the sale portion.