MICHIGAN TAX CREDIT
The Michigan Community Foundation Tax Credit
Did you know that when you or your business make a gift to one of The Jackson County Community Foundation’s endowment funds, your contribution may be worth up to three times your out-of-pocket expense?
Thanks to the Michigan Community Foundation Tax Credit, you can multiply the effect your charitable gift and receive a generous tax credit on your Michigan State taxes.
How Does It Work?
The law permits a taxpayer to reduce their Michigan Income Tax or Single Business Tax liability by a credit of 50% of the amount contributed to a community foundation endowment fund, subject to a maximum credit of:
- $100 for an individual filing singly (based on a $200 contribution)
- $200 for a married couple filing jointly (based on a $400 contribution)
- $5,000 or 10% of tax liability before claiming any credits, whichever is
less - for a resident estate or trust (based on a $10,000 contribution) $5,000 or 5% of tax liability before claiming any credits, whichever is less
- for taxpayers filing Michigan Single Business Tax returns (based on a
$10,000 contribution)
Michigan Community Foundation Tax Credit Examples
Corporate Tax Savings
| Amount of Annual Gift: |
$10,000
|
| Single business tax credit 50% | $5,000
|
| Federal tax savings of 35% | $3,500 |
| Actual cost of corporate gift: | $1,500* |
Individual Tax Savings
| Amount of Annual Gift: | $200 |
| Michigan state tax credit: | $100 |
| Federal tax rate: | 36% |
| Federal tax savings: | $72 |
| Actual cost of gift: | $28* |
Married Tax Savings
| Amount of Annual Gift: | $400 |
| Michigan state tax credit: | $200 |
| Federal tax rate: | 31% |
| Federal tax savings: | $124 |
| Actual cost of gift: | $76* |
*NOTE: This information is intended for explanation purposes ONLY. Actual cost is calculated in the year of the gift. Actual tax-related savings may vary depending upon your income level and tax bracket. Your personal tax advisor can assist you with tax credit arrangements. Your gift to The Jackson County Community Foundation will be promptly acknowledged with a confirmation which includes indication of tax credit eligibility to be used in the preparation of your State of Michigan Income Tax Return.