Big news for DuPage donors: Illinois residents can now maximize their impact through the new Illinois Gives Tax Credit Act, which took effect on January 1, 2025. But the State’s annual funding of the program is limited, so it’s important to be proactive.
What is the Illinois Gives Tax Credit?
With the Illinois Gives Tax Credit Act, donors can contribute to permanent charitable endowments at Qualified Community Foundations – including DuPage Foundation – and receive a tax credit for 25% of their contributions.
This program focuses on building permanent community endowments to support Illinois nonprofits. While gifts to donor-advised funds are ineligible, contributions can be made to support or create funds for the following purposes:
- Unrestricted community endowments
- Funds that support grants to nonprofits working in specific interest areas like food insecurity, housing, mental health, education, the arts, the environment, workforce development, and more
- Funds designated to benefit specific Illinois charities
A maximum of up to $5 million in tax credits per calendar year has been authorized until the Act sunsets in 2029, unless it is extended.
What are the Limitations?
The Illinois Gives Tax Credit offers a limited amount of State tax credits, regardless of whether donors itemize or take the standard federal deduction. It allows for 25% of qualified charitable contributions to be deducted for a maximum state tax credit of $100,000 per person or $200,000 per couple.
The State has limited each Qualified Community Foundation to certify up to $750,000 in credits from donors per year (15% of the $5 million available in total annual credits), which translates to $3 million in aggregate total gifts allowed annually to each Qualified Community Foundation. Additionally, 25% of the total credits are reserved for gifts up to $25,000.
Because these credits are limited and we expect them to be a popular gifting strategy, it’s crucial to act early for 2025. This is your chance to maximize your tax benefits and make a lasting difference for our community.
How Does It Work?
Credits will be awarded to donors on a first-come, first-served basis for those who apply online through MyTax.Illinois.gov, receive a Contribution Authorization Certificate (CAC) from the State, and make their gift to a Qualified Community Foundation within 10 business days upon receiving their CAC.
Once the State’s annual maximum of $5 million in credits is allocated, no more credits will be issued until the following year.
How Can You Use the Credit to Support DuPage?
The Illinois Gives Tax Credit can help us all make a positive impact in our community. DuPage Foundation recently launched All In DuPage, a $35-million endowment-building campaign focused on growing our capacity to annually provide robust, sustained strategic impact where it matters most through our discretionary grantmaking to address our community’s greatest challenges and opportunities.
By leveraging Illinois Gives to support All In DuPage, you can directly invest in your community and help us directly enhance organizations and programs that strengthen DuPage.
How Can You Get Started?
Donors can register contributions through the Illinois Department of Revenue. Learn more about how you can give and apply for credits today by visiting MyTax.Illinois.gov or contacting Kait Balsewicz, director of donor services, at 630.598.5292 or kait@dupagefoundation.org.
Take advantage of this impactful program now to help us do a world of good in DuPage County!
Disclaimer: DuPage Foundation does not provide legal or tax advice and recommends that you consult with your tax and legal advisors and other members of your professional advisor team prior to making a significant charitable gift.
