The proposed legislation, known as the Endow Kansas Tax Credit Act, establishes a tax credit for individuals and businesses that make endowment gifts to certain funds held by qualified community foundations. Starting from taxable years after December 31, 2025, taxpayers can receive a credit equal to 70% of their endowment gift, provided the gift is a minimum of $500. The total amount of credits available is capped at $3 million for tax year 2026, increasing to $4 million for 2027 and $5 million for 2028 and subsequent years. Additionally, there are limits on the amount of credit that can be claimed by individual taxpayers, married couples, and corporations, as well as restrictions on the total credits that can be awarded to a single community foundation.

To qualify for the tax credit, community foundations must apply for certification from the Department of Revenue, which will maintain a list of certified foundations. Taxpayers must also apply for credits and provide documentation of their endowment gifts. The legislation outlines the process for allocating credits, including timelines for making the endowment gifts and stipulations regarding the carryforward of unused credits. The Secretary of Revenue is authorized to adopt necessary rules and regulations for the implementation of this act.