Endow Kentucky Tax Credit Program | OH | KY | IN

Endow Kentucky Program Offers New Tax Credit

Published on by Beth Germann in Not-for-Profit, Tax Services, Wealth Management

Endow Kentucky Program Offers New Tax Credit

Applications Open July 1

A $1 million program in Kentucky provides a unique opportunity for a state tax credit: The Endow Kentucky Tax Credit Program offers a credit toward Kentucky income tax following a contribution to permanent endowment funds at Horizon Community Funds.

The program, which is available for individual income, corporate, or limited liability tax, will begin accepting applications July 1.  The ENDOW credit is a non-refundable credit of 20 percent of the value of the endowment gift, not to exceed $10,000 for an individual or $20,000 for married filing jointly.  Additionally, those receiving the credit are permitted to carry any unused portion of it forward five years to offset future Kentucky state tax.

The program has been in place for nearly ten years with a cap of $1 million in credits offered to applicants for the current year.  As in previous years, the cap is expected to be reached shortly after opening, so applying early is likely to be a key factor in obtaining the credit.

How Endowment Funds Work

Endowment funds, which are established in perpetuity, are very useful for nonprofit organizations to have reliable sources of incoming cash flows, ensuring the cost of operations can be covered.  For example, in the current economic environment, many nonprofits are experiencing a decline in current contributions.  This causes uncertain cash flows making some operations difficult to continue to support.  And there are a variety of funds for donors to consider for contribution.

Non-Profit Organization Options

Horizon Community Funds currently manages funds benefiting ten Northern Kentucky non- profit organizations and causes, including:

  • Boone Conservancy
  • DCCH Center
  • Ignite Institute
  • Licking River Conservation and Greenway
  • Life Learning Center
  • Northern Kentucky University
  • Redwood
  • Riverfront Commons
  • Elizabeth Healthcare Cancer Care Institute
  • The Carnegie.

Gifts may also be made to the Community Impact Fund at Horizon Community Funds, which supports non-profit organizations and charitable needs in Boone, Campbell, and Kenton Counties. More detail is available on the Horizon Community Funds website, and applications for the program are available on the Kentucky Department of Revenue website.

Have a tax question or another concern about endowments? Contact us – our team of top professionals is here to help.


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