TAX ADVANTAGES WHEN ONE DONATES TO YEA!

INDIVIDUALS:
The following chart illustrates how an individual may contribute $100 and with the federal and state deductions, and unique Idaho tax credit, it may only cost $13.80 out-of-pocket cash, depending on the tax bracket the individual is in.

CORPORATIONS:
When a corporation donates to YEA it helps the school or schools in its area reach its vestment by requesting credit be given to its designated school and at the same time it ultimately helps all schools in the state by increasing the balance. The corporate tax credit is 50% of the amount contributed up to $2000 to the extent the contributor does not exceed 10% of income.

IDAHO TAX CREDIT:
Idaho allows a credit up to half of the amount contributed to YEA.  This credit is limited to the lesser of 20% of the taxpayer’s total income tax liability or $100 per person.  Thus, the maximum credit is $200 for a joint tax return and $100 for a single taxpayer.  Actual cost of the contribution is illustrated in the last column after the deductions and credits are taken into account.

“The Tax Advantages of Contributing to the Youth Endowment for Activities Foundation”

63-3029A. Income tax credit for charitable contributions – Limitation.
At the election of the taxpayer, there shall be  allowed, subject to the applicable limitations provided herein, as a credit against the income tax imposed by chapter 30, title 63, Idaho Code, an amount equal to fifty percent (50%) of the aggregate amount of charitable contributions made by such taxpayer during the year to a nonprofit corporation, fund, foundation, trust, or association “organized and operated exclusively for the benefit of institutions of higher learning within the state of Idaho, to non-profit private  or public institutions of elementary, secondary, or higher education or their foundations located within the state of Idaho.

Within the meaning of Idaho Code Section 63-3029A: Payments for financial support for state level participation in association sponsored interscholastic activities shall be made to Idaho high schools.

The following chart illustrates the tax base for the taxpayer in the 28% federal rate and the 8.2% state rate for Idaho. 

The first column in each chart gives example contributions.  The next column is the value of the deduction the individual or married couple receives on their federal return - 28% of the amount contributed.  The state deduction column shows the value of the deduction of the Idaho return.

In addition, Idaho allows a credit up to half of the amount contributed to YEA!  This credit is limited to the lesser of 20% of the taxpayer’s total income tax liability or $100 per person.  Thus, the fourth column shows the actual cost of the contribution after the deductions and credits are taken into account.

Prepared for YEA by Arthur Anderson & Co. Tax Consultants