Gifts That Give Back
The Endow Iowa tax credit program allows taxpayers to receive an Iowa state income tax credit equal to 25 percent of the value of a gift to an endowed charitable fund. These gifts are not eligible for a state income tax deduction but qualify for the federal charitable deduction. These tax credits are only available when giving to an endowed fund through a qualified community foundation like ours.
How It Works
A variety of gifts qualify, including cash, cryptocurrency, real estate, appreciated securities and outright gifts of retirement assets.
Gifts can be made to an existing permanent endowed fund or one you establish. The gift must benefit one or more Iowa charitable causes.
Tax credits equal to 25 percent of the value of the gift are limited to $100,000 per individual and $200,000 per couple if both are Iowa taxpayers.
You can carry forward the tax credit for up to five years after the year the credits are awarded.
What is an Endowed Fund?
Endowed funds are pooled and invested to enhance the value of the original gift while allowing for regular distributions to nonprofit organizations. Endowed funds are permanent, which means they will provide support for your community forever.
How the Endow Iowa Tax Credit Impacts Your Gift
With Endow Iowa, gifts to the Community Foundation cost donors less. While we encourage all donors to work with their advisors to choose the giving strategy that works for them, here is how the Endow Iowa tax credit could impact a gift:
*For ease of illustration, the examples above do not factor in the federal/state net tax effect. Examples assume the donor is in the 37% tax bracket and plans to claim a charitable deduction on the federal tax return.
| Gift Amount | $1,000.00 | $10,000.00 | $100,000.00 | $400,000.00 |
|---|---|---|---|---|
| Endow Iowa Tax Credit (25%) | (250.00) | (2,500.00) | (25,000.00) | (100,000.00) |
| Net Federal Deductible Gift | $750.00 | $7,500.00 | $75,000.00 | $300,000.00 |
| Federal Tax Savings (37%) | (277.50) | (2,775.00) | (27,750.00) | (111,000.00) |
| Net Cost of Gift | $472.50 | $4,725.00 | $47,250.00 | $611,000.00 |
Questions? Contact Us.
 Christi Smeed, MAcc |