ND Tax Credits
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In 2011, N.D. legislators passed a bill that allowed a very generous tax credit to those who make a charitable gift to a N.D. qualified endowment. If you are a North Dakota resident and make a gift of $5,000 or more to a N.D. qualified endowment, you are eligible for a 40 percent tax credit on your N.D. taxes. Tax credits are much different than a tax deduction because they reduce your tax liability dollar for dollar. The maximum tax credit allowed is $20,000 for individuals or $40,000 for married couples filing jointly. However, credits may be carried forward up to three years.
The following is an example of how tax credits may benefit you:
Gift Amount $5,000 $25,000 $50,000 *Federal tax savings $1,250 $6,250 $12,500 ND state income tax credit -$2,000 -$10,000 -$20,000 Net "Cost" of gift $1,750 $8,750 $17,500 *Based on individuals that fall in the 25 percent Federal tax bracket. Please consult your own financial or tax advisor for your unique situation.