Leon Czikowsky, who is dying, made a generous gesture as he closes the last chapter of his life. Instead of the expected serenity, he got financial anxiety.
Czikowsky, 61, was diagnosed in November with stage IV esophageal cancer that had spread to all four lymph nodes. His prognosis: terminal.
A widower with no heirs, in April he decided to donate his family's ancestral Harrisburg home to the State Museum of Pennsylvania in Harrisburg. He was motivated to do that because for 28 years he had worked for the commonwealth, most of that time as a research and legislative aide to Philadelphia State Rep. Mark Cohen. "I thought it good to give back to the commonwealth," he says. The plan was for the museum to sell the house and its contents, and pocket the proceeds.
The house has been in Czikowsky's family for seven generations and is valued at $179,000.
The museum itself is not allowed to accept gifts, so Czikowsky dealt with the Pennsylvania Heritage Foundation, which can receive gifts and grants for the museum, its archives, and 22 state-supported historical sites.
The foundation sent him paperwork, which he signed and returned, Czikowsky says, after his attorney added language that the gift was being made to a nonprofit institution.
Czikowsky never expected what happened next.
The foundation's attorney, David Evenhuis, told Czikowsky he was on the hook for $7,000 in taxes.
Ever hear the line, "Let no good deed go unpunished"?
The $7,000 tax bill included "$3,000 in school taxes I was expecting, and I have paid that," Czikowsky tells me. It was the $4,000 realty transfer tax on the two-story house that blindsided him.
"I never expected I would have to pay $4,000 for the privilege of donating a house" to the museum, he says. That might surprise you, too.
He says no one from the museum cautioned him about the real estate tax liability. Attorney Evenhuis confirms that he told Czikowsky he'd have to pay the bill, but that he could not otherwise comment.
Czikowsky's attorney didn't know about the real estate transfer tax liability because his practice is in Connecticut, where gifts to charitable organizations are not subject to that tax.
It seems to me someone at the foundation should have warned Czikowsky that a gift of real estate could leave him holding the bag of owed tax money. Czikowsky is in a bind because he does not have $4,000 for the tax.
In the midst of this, Czikowsky says, the foundation sent him a form "where they wanted me to write about my donation to encourage others to donate to the commonwealth. I am glad I did not return it before I learned about this tax." It was kind of adding insult to injury.
"I just think that the museum is going to gain financially from this and I wish they would pay the tax," he tells me.
That seems fair to me.
More important, it seems fair to Glenn Holliman, president of the Pennsylvania Heritage Foundation.
Holliman praised Czikowsky's generosity and says the foundation will pay the real estate transfer tax. The foundation was disturbed, he says, when it learned "that an additional worry was placed on Leon's shoulders."