The Endow Iowa Program and Iowa Legal Aid Foundation – Frequently Asked Questions
Why an Endowment?
Because Iowa Legal Aid’s many sources of funding are subject to significant flux, particularly in volatile economies, the organization is seeking an endowment to provide a consistency of funding which would reduce temporary shortfalls and remove the need for periodic staff reduction and, therefore, reductions in service that accompany those periods of reduced funding.
How do I make a donation to the Iowa Legal Aid Foundation and receive the tax credit?
To receive the tax credit under the Endow Iowa Program, donations must be made to a “qualified” community foundation. The Iowa Legal Aid Foundation has partnered with the Greater Cedar Rapids Community Foundation (GCRCF) to meet this requirement. To make a donation, simply send a check to the GCRCF and note your donation is for the Iowa Legal Aid Foundation. You will then receive a simple form to fill out and return to the GCRCF. The GCRCF then forwards the required paperwork to the Iowa Department of Economic Development, which will send you a tax credit award statement.
If I make a gift this year, am I certain to get a tax credit this year?
While you are certain to get a tax credit, you may not be able to use the credit in the same year you make the donation. Iowa places an annual limit on the total tax credits allowed. Donors qualify on a first-come, first-serve basis until the yearly tax credit limit is reached. If you donate after the limit is reached, you will generally be able to use the credit the next tax year. Typically, a gift made the first 6 to 9 months of the calendar year will qualify you for a same year tax credit.
Can I still deduct my charitable contributions on my federal and Iowa income tax returns?
For 2009, the tax credit is in addition to normal charitable income tax deductions for charitable donations. Beginning in 2010, contributions to Endow Iowa will no longer be deductible for Iowa income tax; however, the credit will increase to 25% from 20%. Federal deduction is permitted.
If I donate, how does Iowa Legal Aid Foundation receive my gift?
Endow Iowa contributions must be placed into an endowment fund administered by the community foundation that receives the designated donation. The Iowa Legal Aid Foundation typically would receive not more than 5% of the balance of its Endow Iowa fund in any one-year period, depending upon the community foundation’s spend rate. The Endow Iowa fund is designed to ensure that the balance of the funds remain to generate annual income for charitable use year-after-year.
If I want to learn more of the work of Iowa Legal Aid, or the Iowa Legal Aid Foundation, who should I call?
· Mark Elliott at 515.243.2980 x1617 or melliott@iowalaw.org
· Dennis Groenenboom at 515.243.2980 x 1620 or dgroenenboom@iowalaw.org