Missouri taxpayers, including individuals and businesses, who donate to a pregnancy resource center (PRC) like PCC are not only helping provide hope and help to women and men facing unplanned pregnancy.
Under certain circumstances, they may also be eligible for a state tax credit of 70% of their donation.
How the Process Works:
At the beginning of each fiscal year, July 1, the Department of Social Services (DSS) equally divides the total amount of available tax credits among all eligible pregnancy resource centers (currently 74). This means that all centers across the state receive the same initial allocation, regardless of area population or number of clients served. Also, as more centers open across the state, each center’s initial allocation is reduced.
The amount of total credits available for all centers cannot exceed $3.5 million in a state fiscal year (July 1 through June 30) beginning July 1, 2019.
As donations are made and tax credit applications completed, the center tracks the amounts used and mails the applications with all supporting documentation to DSS. DSS then processes all applications and sends the tax credit certificates, which you will need to file your taxes, directly to the taxpayer.
As centers use their tax credit allocations, they can request in writing an additional allotment directly from DSS. Then each quarter, DSS reviews the cumulative usage of tax credits by all centers. If a pregnancy resource center fails to use all its apportioned tax credits during the predetermined period, DSS can redistribute those credits to centers who have used all or most of their allotment.
This is a time-consuming process for the state since they are communicating with all centers and trying to reapportion credits so that, to the maximum extent possible, taxpayers can claim all available tax credits. DSS then notifies each center who was affected by the reallocation process whether they received more or fewer credits.
Through the years, as pregnancy resource centers and their donors have become more knowledgeable about tax credits, and as more centers have started operating in Missouri, the demand for tax credits has increased and the supply (per center) has decreased.
This makes knowing exactly what is available in credits, especially during the quarterly reapportionment process, challenging for both the state and the centers. Since December 31 falls in the middle of the state fiscal year, only one quarterly reallocation, after September 30, has been completed by calendar year end.
At PCC, we track tax credit allocations and usage on an ongoing basis and submit tax credit applications for which we have credits available within 3-5 business days of receiving them. If an application is received, but there are no tax credits available at that time, we track them on a first-come, first-served basis and submit them as soon as more tax credits become available.
For specific information about PCC’s tax credit availability, please email Nancy Lee at firstname.lastname@example.org or call 417-877-0800.
What are the donation and tax credit requirements?
- There is a $100 minimum contribution, of which 70% is tax-credit eligible for donations made after January 1, 2021. Donations made in 2020 are eligible for a 50% tax credit. Donors can claim up to a $50,000 credit per tax year.
- Donations can be made by cash, check, credit card, stocks, bonds and other marketable securities as well as real estate. Note: Donations that include a benefit to the donor will be reduced by that amount, i.e. a meal at a fundraising banquet.
- The amount of the claimed tax credit may not exceed the amount of the taxpayer’s state income tax liability for the year the credit is being claimed.
- Any tax credit that cannot be claimed in the tax year associated with the contribution may be carried forward and used against a taxpayer’s state tax liability the next succeeding tax year.
What are the donor’s responsibilities?
- Make a qualifying donation.
- Submit a complete and accurate original (no photocopies, faxes or emailed copies) tax credit application to PCC within 12 months of the donation date. If filing a joint tax return, both names, social security numbers and signatures must be included on the application.
What are PCC’s responsibilities?
- Respond to all requests from DSS for eligibility verification and analysis of tax credit amounts used throughout the fiscal year.
- Complete our portion of all tax credit applications, including the total value of all donations during the specific time period, the tax credit amount for that same period and the Executive Director’s signature.
- Compile supporting documentation and submit with tax credit applications to DSS in a timely manner. We may request additional supporting documentation from the taxpayer(s) for certain types of donations, such as stocks or bonds.
- Process tax credit applications on a first-come, first-served basis. We are not able to offer any exceptions to this DSS rule.
Do all benevolent tax credits work the same way?
No, there are many different benevolent tax credits in Missouri, and each one is administered under different guidelines.
For more detailed information about Missouri PRC tax credits, please visit: https://dss.mo.gov/dfas/taxcredit/pregnancy.htm