Save up to $10,000 on your Montana taxes!
What is it?
Originally enacted in 1997, the Montana Income Tax Credit for endowed Philanthropy encourages charitable giving to qualified endowments by offering incentives to Montana taxpayers.
The Montana Qualified Endowment Tax Credit allows donors to pay less in Montana state income taxes when they give a qualifying planned gift to a qualified Montana charitable endowment like the Bozeman Area Community Foundation’s permanent endowment fund or any of the Nonprofit endowment funds held at the Community Foundation.
An endowment is a fund held by a tax exempt organization where the principal of the fund is not wholly expendable. Only the interest and appreciation earned in an endowment fund can be used for current operations. Endowments are established to help Montanans meet long-term needs in our communities for education, social services, health care, economic development, the arts and more.
Individual Planned Gift:
Individuals who make a planned gift to a qualified Montana endowment fund will receive a tax credit of 40% of their gift, with a maximum credit of $10,000 ($20,000 for joint filers).
Business/Corporation Outright Gift:
Businesses and corporations that make a direct gift to a qualified Montana endowment fund will receive a tax credit of 20% of their gift, with a maximum credit of $10,000.
It is easy to do:
For example, a couple would like to take advantage of the Montana Charitable Endowment Tax Credit and benefit their favorite nonprofits’ endowment funds. They contact the Community Foundation and set up a deferred gift annuity for $20,000. They receive a tax “credit” of 40% of this gift /$8,000 plus a significant federal tax deduction. The out-of-pocket cost for a deferred gift annuity (deferred to full life expectancy) is potentially only about 1/3 of the gift.
Read more at the Endow Montana website.
Montana Code Annotated
- Definition of a Planned Gift 15-30-2327(1) MCA
- Definition of a Qualified Endowment 15-30-2327(2) MCA
- Defining the Tax Credit for Planned Gifts 15-30-2328 MCA
- Defining the Tax Credit for Outright Gifts by Business Entities 15-31-161 and 15-31-162 MCA
- Charitable Gift Annuity Exemption Act 33-20-701 thru 705 MCA
- Uniform Prudent Management of Institutional Funds Act 72-30-101 thru 103 MCA
Contact your financial advisor to see if the Montana Endowment Tax Credit is right for you.
Contact the Bozeman Area Community Foundation to make a direct gift or a planned gift to a qualified Montana endowment fund at 406-587-6262.