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North Dakota Tax Credit

Charitable Gifts = 40% Tax Credit

Recent North Dakota legislation increases the opportunities for North Dakota taxpayers to get a generous 40 percent state income tax credit for charitable contributions to organizations like The Salvation Army.

With this credit alone, you can make a gift of $5,000 to The Salvation Army endowment fund for a net cost of just $3,000 after the North Dakota tax credit. And, when you consider federal tax deductions, net cost can be even less, depending on your tax bracket.

Overview

  • The credit is available to both individuals and businesses
  • The minimum qualifying gift is $5,000 (lump sum or aggregated over the tax year)
  • Both outright and planned gifts can qualify
  • The maximum credit for a single tax year is $10,000 for an individual, $20,000 for a married couple and $10,000 for business entities. There are provisions for carryover.

Three Ways to Get the Tax Credit

Individuals:

  • Make an outright gift to a qualifying Salvation Army endowment fund. Your gifts can be in the form of cash, securities or real estate.
  • Make a planned gift to The Salvation Army such as a charitable gift annuity; certain forms of charitable trusts and paid-up life insurance may qualify.

Businesses:

  • Make an outright gift to a qualifying Salvation Army endowment fund.

Outright Endowment Gift Tax Credit Examples

Typical tax credit benefits for endowment gifts

Tax Credit Plus Income for Life with a Charitable Gift Annuity

This example is for a 76-year-old (one life) at the 6 percent rate. Rate is determined by age and is locked in for life.

Tax credit plus income for life with a charitable gift annuity

Note: These educational examples are not professional tax or legal advice; consult a tax adviser about your specific situation.

Important Points to Remember

  • This is a North Dakota tax credit, not a deduction.
  • The contribution can still be deducted from your Federal income taxes.

If you could use this generous tax credit, contact your tax adviser or The Salvation Army’s planned giving office:

Minnesota and North Dakota Planned Giving Director
David Overstake, 651-746-3504

North Dakota Planned Giving Representative
Anthony Hebert, 701-219-9675