HAVE YOU HEARD ABOUT tHE ENDOW KENTUCKY TAX CREDIT?
A gift to an endowed fund at Blue Grass Community Foundation could earn you a substantial state tax credit.
As of December 14, $59,032 is still available in this year’s Endow Kentucky tax credit pool. Donors can apply now for the full 20% state of Kentucky tax credit, which will be approved based on the order of application until all the credits are exhausted. Interested donors should act quickly due to the limited number of available tax credits.
Unlike tax deductions, tax credits are taken off a tax bill dollar for dollar. This credit can reduce a donor’s Kentucky tax bill to zero. For example, a gift of $5,000 can eliminate a tax liability of $1,000. And these credits can be carried forward for five years.
Donors may receive the tax credit by establishing their own charitable endowment fund or by contributing to existing ones at the Community Foundation.
To apply for the tax credit, donors must file an application for preliminary authorization with the Kentucky Department of Revenue. Instructions and an application for preliminary approval are available online here.
This year, all applications submitted to the Kentucky Department of Revenue between July 1 and July 7 will receive a prorated portion of the Endow Kentucky State tax credit.
Don’t miss out! To be in the running to receive these state tax credits, donors must apply by July 1, 2016.
HOW DOES IT WORK?
- Obtain preliminary approval. Fill out the APPLICATION FOR PRELIMINARY AUTHORIZATION and submit to the Kentucky Department of Revenue via email, fax or hand delivery. (NOT by US mail.)
- After you receive preliminary approval from the Kentucky Department of Revenue, submit it to the Community Foundation.
- Within 30 days of receiving your approval letter from the Kentucky Department of Revenue, make your contribution to an endowment fund at Blue Grass Community Foundation.
- Within ten days of making your gift, the Community Foundation will send proof of your gift to the Kentucky Department of Revenue, which will in turn send you a letter of final approval to include with your 2016 Kentucky state tax return.
The Community Foundation can handle all the paperwork for you.
Click here for a list of nonprofit and community endowments held at the Community Foundation. You may apply for a credit on a gift to any one of these funds or to your own endowed donor advised giving fund at the Community Foundation.
Endowment funds ensure perpetual support for the charities and civic projects that make our communities better places to live, work and play. There is no better way to make a long-term difference in the quality of life in our community.
Whether it’s supporting an existing endowment at Blue Grass Community Foundation or creating one of your own, we can help, every step of the way. For more information, contact Brian Dineen (firstname.lastname@example.org). Or call the Community Foundation at 859.225.3343.