Montana Form Qec - Qualified Endowment Credit

has met the following requirements at the time the annuity

The credit allowed against corporation license tax or

is issued:

income tax liability for a contribution of a planned gift is

40% of the present value of the allowable contribution.

●

Have a minimum of $300,000 net worth or a

minimum $100,000 in unrestricted cash, cash

The credit allowed against corporation license tax or

equivalent or public traded securities;

income tax liability for a direct contribution is equal to 20%

of the charitable contribution.

●

Have been in business for at least three years;

Line 7. Multiply the amount on line 5 by the percentage on

●

Have one-half of the outstanding annuity

line 6. Do not enter more than $10,000.

maintained in a separate annuity fund.

Please note the following limitations on the qualified

If the above requirements are not met, the gift annuity must

endowment credit:

be commercially insured by a licensed insurance company

qualified to do business in Montana.

●

The maximum credit that may be claimed by a

taxpayer for contributions made from all sources in

Charitable gift annuity. This is the transfer of cash

a year is $10,000.

or property to a charity in exchange for the charity’s

promise to pay the donor and, if applicable, the

●

The credit may not exceed the taxpayer’s income

surviving annuitant, a lifetime annuity. This type of

tax liability.

annuity is considered a bargain sale that results in

●

There is no carryback or carryforward of the credit.

part taxable gain and a charitable deduction. The

annuity agreement must provide that the interest of the

●

The credit must be applied to the tax year in which

annuitant(s) in the gift annuity may not be assigned

the contribution is made.

to the qualified endowment sooner than the earlier

To learn more about the endowments state-wide, visit the

of the date of death of the annuitant(s) or five years

Governor’s Task Force on Endowed Philanthropy website

after the date of the contribution. The charitable

organization issuing the annuity must also meet

Administrative Rules of Montana: 42.4.2701 through

additional requirements imposed in 33-20-701, MCA

that are administered by the Montana Commissioner of

42.4.2708

Insurance.

Questions? Please call us toll free at (866) 859-2254 (in

Deferred charitable gift annuity. This is an annuity in

Helena, 444-6900).

which payments to the donor do not begin until a future

date. Deferred charitable gift annuities are subject to

the same requirements as charitable gift annuities. In

addition, the payment of the annuity has to begin within

the life expectancy of the annuitant or of the joint life

expectancies of multiple annuitants.

Part II. Credit Calculation

If the gift you are claiming the credit for was a planned

gift, complete Column A. If it was an outright gift, complete

Column B. Do not complete both columns.

Line 5. Enter the present value of the aggregate amount

of the charitable gift portion of your planned gift, or your

outright charitable contribution (the charitable deduction

amount) in the corresponding column.

If you are an individual and are not receiving the credit from

a pass-through entity, you should only complete column A.

In this situation, only the contributions you make in the form

of a planned gift qualify for the credit.

If you are receiving the credit from a pass-through entity,

enter your distributable share of the contribution made

by the pass-through entity. You will also need to enter the

pass-through entity’s business name and federal employer

identification number (FEIN) in the space provided.

Line 6. The percentage of credit you can receive for your

contribution is based on whether it was a planned gift or an

outright gift.

Montana Form Qec - Qualified Endowment Credit - 2012 Page 4

Related Articles

Related forms

Related Categories