This bill amends the Income Tax Act of 1967 by adding a new section, Sec. 261, which introduces a tax credit for contributions made to endowment funds of community foundations. Starting from tax years beginning on or after January 1, 2026, taxpayers can claim a credit equal to 50% of their contributions, with specific maximum limits based on the taxpayer's status. For individual taxpayers, the maximum credit is capped at $100 for single filers and $200 for joint filers, while resident estates or trusts can claim up to 10% of their tax liability or $5,000, whichever is less. To qualify for the credit, taxpayers must provide a gift acknowledgment from the community foundation.

Additionally, the bill outlines that any credit exceeding the taxpayer's liability cannot be refunded and mandates the Department of Treasury to report the total amount of credits claimed annually to relevant legislative committees. The bill also defines "community foundation" and sets a requirement for certification, allowing organizations with at least $1,000,000 in assets to qualify. This new provision aims to encourage charitable contributions to community foundations by providing a financial incentive through tax credits.

Statutes affected:
Substitute (S-1): 206.1, 206.847
Senate Introduced Bill: 206.1, 206.847
As Passed by the Senate: 206.1, 206.847