Donations to the FM Area Foundation generally qualify for a deduction on your federal and state income tax returns.
If you are a North Dakota taxpayer, you may be able to claim a credit of 40% on a minimum donation of $5,000 to a qualified endowment through the North Dakota Charitable Income Tax Credit. This credit is on top of the savings you receive on your federal tax return by itemizing your qualifying charitable donations.
By taking advantage of both the state tax credit and federal tax deduction, you can significantly lower the net cost of your contribution and triple its impact.
Gifts made by an individual to a qualified endowment fund are eligible for the 40% tax credit if the aggregate of that year’s gifts is equal to $5,000 or more.
The maximum credit amount that may be claimed is $10,000 for an individual or $20,000 for married individuals filing jointly.
Example: Mrs. Smith, a North Dakota resident, donates $20,000 in cash to an endowment fund. She receives an $8,000 tax credit (40%) on her North Dakota return. If she is in the 28% Federal tax bracket, her Federal tax savings are $3,360 (28% of $12,000). The “cost” of her $20,000 gift is offset by $11,360 in tax savings.
Gifts made by a business entity to a qualified endowment fund are also eligible for a 40% tax credit. They have an annual limitation of $10,000.
In some cases, the entity will “pass through” some or all of the credit to the business owners or the beneficiaries of the trust or estate.
Example: Partnership XYZ has three equal partners. They would each receive a $3,000 tax credit available for use on their North Dakota individual income tax returns if the partnership qualifies for a $9,000 credit.
This information is provided for educational purposes only. Please consult your attorney, accountant, or financial advisor for advice.
Donors wanting to take advantage of the tax credit can either:
We have several endowed agency funds that qualify for the North Dakota Charitable Income Tax Credit. Agency funds are created to permanently support the operations of a particular nonprofit organization.
When you give to one of these funds, you will not only be able to claim the tax credit; you will be making a sustainable, forever gift. Donors who decide to create or add to an endowment do so because they understand the importance of supporting the organization during their lifetime and for generations to come.
We can do so much more for our communities by working together. If you want to make a difference close to home, you can join like-minded supporters and give to one of our 400+ charitable funds, each with its own unique story and purpose.
“We wanted the scholarship to live on as a legacy for Norman and I in our communities to encourage a young person as they seek their dreams.”
“Serving on the Foundation board enables me to support efforts to strengthen our community.”
“We are thrilled to engage our daughters as future advisors to our fund. Knowing there will always be a family member to guide our charitable intent makes us feel great.”
“Anything that can motivate a child’s love of reading deserves support. Read to Lead can be such a vehicle.”
“Thank you to the Women's Fund for supporting our moms and children.”
“The community foundation is specifically created to encourage and nourish the giving spirit in the community.”
“Thanks to support from the FM Area Foundation, we completed two major projects. We're very grateful for the Foundation’s generosity as these projects support our mission to preserve and maintain the historic facility.”
