WeVote
Log In

Bill

Bill

HB 2208

Establishing the endow Kansas tax credit act to provide tax credits for endowment gifts to certain endowment funds held by qualified community foundations.

2025-2026 Regular Session

The bill offers a 70% nonrefundable tax credit for eligible permanent endowment gifts to Kansas community foundations, with annual caps and carryforward.

Died in Committee
#financialinstitutions #namedacts #rulesandregulations #administrative #taxation
0
WeVote Research Nonpartisan
Bill Summary · HB 2208

Summary — HB 2208: Endow Kansas Tax Credit Act

Status: Introduced January 29, 2025. Hearing before House Committee on Taxation: Monday, February 10, 2025, 3:30 PM (Room 346‑S). Effective for taxable years beginning after December 31, 2025 (tax year 2026 onward).

Main purpose

To encourage the creation and growth of permanent charitable endowments in Kansas by allowing state income/privilege tax credits for endowment gifts made to qualified community foundations.

Key provisions

  • Tax credit amount: 70% of the dollar amount of an eligible endowment gift to an unrestricted permanent endowment fund or a field‑of‑interest permanent endowment fund held by a certified qualified community foundation.
  • Minimum gift: $500.
  • Per‑taxpayer credit caps:
    • Individuals or fiduciaries: up to $100,000 of credits per taxable year.
    • Married filing jointly and corporations (and certain financial institutions): up to $200,000 of credits per taxable year.
  • Aggregate annual credit caps (statewide):
    • Tax year 2026: $3,000,000
    • Tax year 2027: $4,000,000
    • Tax year 2028 and thereafter: $5,000,000
  • Per‑foundation limit: No single qualified community foundation (or a single affiliate) may receive more than 10% of the total aggregate credits in a tax year.
  • Credit mechanics:
    • Nonrefundable and nontransferable.
    • Excess credit over tax liability may be carried forward up to five succeeding taxable years.
  • Administration:
    • Qualified community foundations must be certified by the Kansas Department of Revenue (KDR); KDR will publish a list of certified foundations.
    • Taxpayers must apply to KDR for allocation of credits before claiming on returns. KDR will allocate credits within 30 days; if allocated credits are not tied to a realized gift, the taxpayer generally must make the gift within 30 days of allocation and by year end or the allocation is canceled and reallocated.
    • Secretary of Revenue may adopt implementing rules.

Definitions (selected)

  • "Endowment gift": an irrevocable contribution to an endowed fund held by a qualified community foundation.
  • "Permanent endowment fund": fund whose principal is permanently restricted; earnings support nonprofit programs benefiting Kansas residents.
  • "Qualified community foundation": Kansas nonprofit (501(c)(3)) serving a geographic area no larger than Kansas, supporting broad‑based charitable interests, and accredited or recognized under specified standards.

Fiscal and operational impact

  • Department of Revenue estimates reduced State General Fund revenues beginning in FY2027 (tax year 2026): ($3.0M) in FY2027, ($4.0M) in FY2028, and ($5.0M) annually thereafter (reflecting the statutory caps).
  • The $3.0M credit cap in tax year 2026 would be expected to lever roughly $4,285,714 in endowed gifts (since credits equal 70% of gifts).
  • Implementation costs to KDR: one‑time programming and implementation expenses of $314,431 (FY2026) and ongoing costs to support 1.0 FTE of about $72,181 annually (FY2027 onward). Additional contractor programming could be required if combined workloads exceed internal capacity.

Who is affected

  • Donors (individuals, married couples, fiduciaries, corporations) making qualifying endowment gifts.
  • Qualified community foundations seeking certification and aiming to attract new endowed gifts.
  • Kansas Department of Revenue (administration, certification, allocation).
  • State General Fund (reduced tax receipts up to statutory cap).

Intended effect

Increase long‑term philanthropic capital for Kansas communities by incentivizing permanent endowments, while controlling annual state revenue exposure through statutory caps and per‑foundation limits.

Compiled from official sources — confirm details with the bill’s official record.

Sign in to ask a question.