Endow Iowa Tax Credit

The Endow Iowa Tax Credit Program will be seeing some changes in 2023. Please see below for more details and let us know if you have any questions about these changes. We are proud to be able to continue to connect donors with this tax benefit.

1. 1. 1. Beginning January 1, 2023, the maximum credit per taxpayer is $100,000 per individual or $200,000 per couple if both are Iowa taxpayers. This is a reduction from the $300,000 previously available.
      2. Beginning July 1, 2023, applications must be submitted within 12 months of the date of the gift.
      3. The waitlist process, previously administered by IEDA, will be discontinued on July 1, 2023. All applications that are currently on the waitlist will not be affected by this change. Donors who apply for the Endow Iowa Tax Credit prior to June 30, 2023 will continue to be placed on the 2024 waitlist. In order process your gift and Endow Iowa application before the system closes, donors are encouraged to make Endow Iowa qualified gifts by June 15, 2023.
      4. The Iowa Economic Development Authority (IEDA) has provided guidance that community foundations will not be able to accept or submit Endow Iowa applications on behalf of donors from July 1, 2023 until IEDA re-opens the application. We do not know the date at which the application will open at this time but will let you know as soon as we learn details from IEDA.

As of May 2023, the Senate and House have approved an amendment to the Endow Iowa Tax Credit Bill HF710 which proposes the following changes:

• a one-time $7 million appropriation to the Endow Iowa Tax Credit Program to shore-up the current waitlist; and
• a legislative fix for an issue that was caused when last year’s tax bill passed which impacted donors on the Endow Iowa program waitlist who gave above the new aggregate cap allocation.

We will keep donors apprised when that amendment passes through the Governor’s desk. More information to come!

If you have any questions about these updates, please reach out to Shelly Maharry at Shelly@cfjc.org or (319) 337-0483.

We are committed to helping you maximize the tax benefits from your gift. Because each donor’s giving is unique, the easiest way to learn more about the available tax benefits is to give us a call.

Giving to causes you care about through the Community Foundation is easy and can come with generous tax savings such as capital gains savings on gifts of appreciated assets and gifting directly to charities from Individual Retirement Accounts. Additionally, gifts to endowment funds held only at Community Foundations may be eligible for the 25% Endow Iowa Tax Credit.

The Endow Iowa Tax Credit Program offers contributors who live in Iowa and give through the Community Foundation generous tax incentives to make it easier for you to give more for less.

The program was established to encourage building permanent endowments to benefit communities all across Iowa. Iowa taxpayers may apply for the tax credit if they make a gift to a permanently endowed fund that supports charitable activities in Iowa. Here are some specifics:

• Tax credits are for 25% of the gifted amount.
• Individuals are limited to $100,000 in tax credits per year for a $400,000 gift and a couple is limited to $200,000 in tax credits per year for a $800,000 gift (if both are Iowa taxpayers).
• An individual or a business creating individual tax liability (partnership, LLC, S Corp., estate, or trust) is eligible to receive a tax credit as long as they pay taxes in Iowa. A C Corporation may also receive a tax credit under this program.
• You can claim the tax credit on your Iowa income tax return only. The tax credit is not transferable.
• If an Iowa tax credit is received for a gift, no Iowa income tax deduction for the same gift is allowed.

Endow Iowa Tax Credits are claimed fast, and for 2023, the tax credits are already taken. Please give our office a call at (319) 337-0483 to learn more or for help planning your gift.