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Builders of Excellence Endowment Campaign
By giving to the Builders of Excellence Endowment Campaign, you can double your investment in local health care. Sanford Health is matching dollar for dollar all contributions and pledges received up to $10 million. The goal with the matching funds is to raise $20 million in endowment funds to benefit health care in central and western North Dakota for generations to come.
What is an endowment?
A qualified endowment is defined as an "irrevocable fund held by a North Dakota incorporated or established organization that is a qualified non-profit organization; or a bank or trust company holding the fund on behalf of a qualified non-profit organization." An endowment is a fund held by a tax-exempt organization where the principal of the fund is not expendable. Only the interest and appreciation earned in an endowment fund can be used for current operations.
The North Dakota legislature recently added charitable income tax credit for taxpayers to use when making gifts to North Dakota charitable endowments. The state is a national leader in providing these incentives for donors. Fewer than six states offer tax credits. Itís valuable for those paying North Dakota income taxes to know about these unique tax benefits.
Endowed gifts and planned gifts are appreciated and encouraged at the Sanford Health Foundation in Bismarck. Both are perfect examples of thoughtful, purposeful philanthropy as donors provide permanent funding support for local health care.
The new tax credit, introduced in 2011, is for individual taxpayers. This tax credit makes it possible for North Dakota supporters of Sanford Health to establish permanent endowments which will support health care in North Dakota forever; endowments they might not have otherwise established without this tax credit. (See cost analysis below.) A minimum gift of $5,000 annually is required to qualify. The donor then benefits from a 40 percent income tax credit with a maximum credit of $10,000 per person, $20,000 for a married couple with any excess unused credit to carry forward three years.
We encourage donors to seek tax and legal advice from their professional advisors. We provide this as a hypothetical endowment example. For a taxpayer in the 28 percent federal tax bracket, the tax benefit of a charitable endowment tax credit in North Dakota could be as follows:
Business and financial institution tax credit
Businesses and financial institutions (C corporations, S corporations, estates, limited liability companies and trusts) making gifts to qualified endowments may also qualify for a state income tax credit, which amounts to 40 percent of the value of the gift, with a maximum credit of $10,000 per year. Businesses may carry forward any unused credit for up to three taxable years (financial institutions excluded).
Planned gifts by individuals
Individual taxpayers are allowed to claim up to a $10,000 credit and joint tax filers up to a $20,000 credit for planned gifts made to qualifying North Dakota nonprofit organizations such as the Sanford Health Foundation. Similar to the endowment credit, the amount of the credit is computed at 40 percent of the federal deduction created by the gift. The credit may be claimed in the year of the gift, plus a carry-forward period of three years. Eligible planned gifts include: various types of charitable trusts, current and deferred charitable gift annuities, certain paid-up life insurance policies, pooled income fund trusts, and charitable life estate agreements.
Q. What does it cost to fund an endowment?
Q. Can I stipulate a specific purpose for my endowment?
Q. Can I customize the name of my endowment?
Q. How can an endowment be funded?
Q. Can I also fund an endowment through my estate or with a planned gift?
Q. Are distributions made from my fund soon after it is established and fully funded? How much is distributed? Does the Foundation charge an administrative fee?
Q. Why doesnít the Foundation distribute more?
If you are interested in making a significant impact on the lives of others by giving to the Builders of Excellence Campaign, contact the Sanford Health Foundation in Bismarck at (701) 323-8450, firstname.lastname@example.org or visit our office which is located in the Seventh & Broadway Clinic, 715 E. Broadway Ave., Bismarck.