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 obtain a gift acknowledgment from the community foundation.

Additionally, the bill stipulates that any credit exceeding the taxpayer's liability cannot be refunded, and the Department of Treasury is required to report the total amount of credits claimed annually to relevant legislative committees. The bill also defines "community foundation" and sets the criteria for certification, requiring organizations to apply by May 15 of the tax year and maintain a minimum asset threshold of $1,000,000 to qualify.

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