8 Reasons to Support the Montana Charitable Endowment Tax Credit

The Montana Charitable Endowment Tax Credit

Established in 1997 to encourage individuals, businesses and organizations to make lasting charitable investments in their communities, the Montana Charitable Endowment Tax Credit (MCETC) creates an incentive to give to charitable endowments.

What is the Montana Charitable Endowment Tax Credit?

The MCETC is a credit against state income tax liability in the amount of 40% of the present value of any planned gift to a permanent endowment of a Montana charity up to a maximum amount of $10,000 per year per individual taxpayer. (Applies to individual or business entity taxpayers.)

The MCETC is also available to businesses as a credit against state income tax liability in the amount of 20% of the present value of any outright gift by a business entity to a permanent endowment of a Montana charity up to a maximum of $10,000 per year per taxpayer. (Applies to corporations, small business corporations, partnerships or limited liability company taxpayers.)

What is the history of the Montana Endowment Tax Credit?

Recommended by then Governor Racicot’s bipartisan Task Force on Endowments and Philanthropy, the MCETC was passed by the legislature in 1997, and renewed with a sunset provision in 2001, 2007, and 2013. The law is set to expire on December 31, 2019. The bill to extend the MCETC is SB211.

Why should you support the renewal of the Montana Endowment Tax Credit?

  1. It helps ensure money created in Montana, stays in Montana, for Montana, forever.
  2. The charitable tax credit works. More than $145 million has been contributed to Montana charitable endowments to date, in large part because of this incentive.
  3. At a 5% payout, an estimated more than $7.25 million is distributed annually to support charitable causes in Montana from endowments.
  4. It is a unifying, bi-partisan issue as it promotes philanthropy in Montana and gives Montanans a say in where their money should go in their communities, now and in the future.
  5. The credit is unique, in that a person receives a tax benefit for doing something good for someone else.
  6. The MCETC is a visionary, innovative and effective incentive for philanthropic giving even in the most rural communities of Montana.
  7. The MCETC is effective and efficient. Each gift involving the credit can cost the Government a maximumof just $2 for every $5 given. The cost to government is actually lower because the value of gifts made toqualify for the credit often far exceeds the amount that qualifies for the $10,000 credit maximum.
  8. The credit is predictable. According to the Department of Revenue, the total credits taken in recent years were $2.5 million (2015), $2.7 million (2016) and $3.1 million (2017).

The Montana Endowment Tax Credit has proven its worth to Montana. Spread the word!

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