The Community Foundation of Greater Des Moines is a qualified community foundation that provides access to Endow Iowa Tax Credits. Endow Iowa allows taxpayers to receive a 25% Iowa tax credit in addition to normal federal charitable income tax deductions for certain charitable gifts. Approximately $4.5 million in Endow Iowa Tax Credits will be awarded in 2013.
The charitable gifts must be made:
- Through a qualified community foundation.
- To a permanent endowment fund which limits distributions to 5%.
- For the benefit of one or more Iowa charitable causes.
- By individuals or businesses.
This is an exciting program that benefits both donors and charities. Below is an approximation of the net after-tax costs of establishing a fund:
Cash Gift $ 1,000 $10,000 $100,000
Less tax benefits:
*Net federal tax savings - 350 - 3,500 - 35,000(approximated assuming maximum tax bracket)
*Endow Iowa Tax Credit - 250 - 2,500 - 25,000
(before federal tax effect)
Net cost of contribution $ 400 $ 4,000 $ 40,000
Gifts of appreciated assets: The net cost could be even lower if capital gains taxes and/or alternative minimum taxes are avoided.
HOW IT WORKS:
- A variety of gifts qualify for Endow Iowa Tax Credits including cash, real estate, appreciated securities and outright gifts of retirement assets.
- Tax credits of 25% of the gifted amount are limited to $227,590 in tax credits per individual for a gift of $910,362 or $455,181 in tax credits per couple for a gift of $1,820,724 if both are Iowa taxpayers.
- Eligible gifts will qualify for credits on a first-come/first-serve basis until the yearly appropriated limit is reached. If the current available Endow Iowa Tax Credits have been awarded, qualified donors will be eligible for the next year’s Endow Iowa Tax Credits. HCCEF encourages donors to act early in the year to ensure they receive Endow Iowa credits.
- All qualified donors can carry forward the tax credit for up to five years after the year the donation was made.
- Endow Iowa Tax Credits allow donors to have even greater impact on their philanthropic interests in Hardin County now and into the future.
We encourage donors to consult with a tax advisor to review their individual circumstances.
For more information about establishing a fund at
HCCEF contact Tam Elerding, Program Director, 641-373-1379 or firstname.lastname@example.org