The Montana Income Tax Credit for Endowed Philanthropy
Specific tax credits are available for Montana citizens when donating to qualified permanent endowments in Montana. A permanent irrevocable fund is a fund that receives or will receive the charitable gift portion of a planned gift or a direct charitable contribution, and holds the charitable gift on behalf of a tax exempt 501(c)(3) organization for the life of the organization. The maximum credit that you may claim in the year is $10,000. If you are married and both spouses gave a qualified gift, each spouse is entitled to a maximum $10,000 Credit. Your credit cannot exceed your tax liability and you cannot carry back or carry forward any unused credit.
Individuals - You are entitled to a credit against your tax liability equal to 40% of the charitable gift portion of a planned gift. In order to qualify for the endowment credit an individual must contribute an irrevocable planned gift with the remainder to a permanent endowment.
The types of gifts that qualify for this credit are:
- Charitable Gift Annuity
- Deferred Charitable Gift Annuity
- Paid-up Life Insurance Policy
- Pooled Income Fund Trust
- Charitable Life Estate Policy
- Charitable Remainder Unitrust
- Charitable Remainder Annuity Trust
- Charitable Lead Unitrust
- Chartable lead Annuity Trust
Corporations - If you are a C. corporation, an S. corporation, partnership or limited liability company you are entitled to a credit against your tax liability equal to 20% of the outright charitable contribution to a qualified endowment.
The Montana Department of Revenue Form MT-QEC-08 for claiming the Qualified Endowment Credit is available in PDF format.