H. B. 2102
(By Delegate Kiss, By Request)
[Introduced January 10, 1996; referred to the
Committee on Finance.]
A BILL to amend article twenty-one, chapter eleven of the code of
West Virginia, one thousand nine hundred thirty-one, as
amended, by adding thereto a new section, designated section
fifteen-a; and to amend article twenty-four of said chapter
by adding thereto a new section, designated section
eleven-b, all relating to personal income and corporation
net income tax credits and allowing a credit against a
taxpayer's tax liability for contributions to community
foundations and homeless shelters and services.
Be it enacted by the Legislature of West Virginia:
That article twenty-one, chapter eleven of the code of West
Virginia, one thousand nine hundred thirty-one, as amended, be
amended by adding thereto a new section, designated section
fifteen-a; and that article twenty-four of said chapter be
amended by adding thereto a new section, designated section eleven-b, all to read as follows:
ARTICLE 21. PERSONAL INCOME TAX.
§11-21-15a. Credit for contribution to qualified community
foundation or homeless shelter.
A taxpayer is allowed a credit, against the tax imposed by
the provisions of this article, of fifty percent of the amount
the taxpayer contributes during the taxable year to an endowment
fund of a community foundation or fifty percent of the cash
amount the taxpayer contributes during the taxable year to a
shelter for homeless persons, food kitchen, food bank, or other
entity, the primary purpose of which is to provide overnight
accommodation, food or meals to persons who are indigent if a
contribution to that entity is tax deductible for the donor under
the Internal Revenue Code.
For a taxpayer other than a resident estate or trust, the
credit allowed by this section for a contribution to a community
foundation shall not exceed one hundred dollars, or two hundred
dollars for a husband and wife filing a joint return. For the
one thousand nine hundred ninety-five tax year and each tax year
after the one thousand nine hundred ninety-five tax year, a
taxpayer may claim an additional credit under this section not to
exceed one hundred dollars, or two hundred dollars for a husband
and wife filing a joint return, for total cash contributions made
in the tax year to shelters for homeless persons, food kitchens and food banks.
For a resident estate or trust, the credit allowed by this
section for a contribution to a community foundation shall not
exceed ten percent of the taxpayer's tax liability for the tax
year before claiming any credits allowed by this section or five
thousand dollars, whichever is less. For the one thousand nine
hundred ninety-five tax year and each tax year after the one
thousand nine hundred ninety-five tax year, a resident estate or
trust may claim an additional credit under this section not to
exceed ten percent of the taxpayer's tax liability for the tax
year before claiming any credits allowed by this section or five
thousand dollars, whichever is less, for total cash contributions
made in the tax year to shelters for homeless persons, food banks
and food kitchens.
The credits allowed by this section are nonrefundable so
that a taxpayer shall not claim under this section a total credit
amount that reduces the taxpayer's tax liability to less than
zero.
As used in this section, "community foundation" means an
organization that applies for certification on or before the
first day of April of the tax year for which the taxpayer is
claiming the credit and that the department of tax and revenue
certifies for that tax year as meeting all of the following
requirements:
(a) Qualifies for exemption from federal income taxation
under section 501(c)(3) of the Internal Revenue Code;
(b) Supports a broad range of charitable activities within
a specific geographic area of this state that it serves,
including a municipality or county;
(c) Maintains an ongoing program to attract new endowment
funds by seeking gifts and bequests from a wide range of
potential donors in the community or area served;
(d) Is publicly supported as defined by the regulations of
the United States department of the treasury, 26 C.F.R.
1.170A-9(e)(10);
(e) Is not a supporting organization as defined under
section 509(a)(3) of the Internal Revenue Code and the
regulations of the United States department of the treasury, 26
C.F.R. 1.509(a)-4 and 1.509d(a)-5;
(f) Meets the requirements for treatment as a single entity
contained in the regulations of the United States department of
the treasury, 26 C.F.R. 1.170A-9(e)(11); and
(g) Is incorporated or established as a trust before the
first day of September of the year immediately preceding the tax
year for which the credit is claimed.
An entity other than a community foundation may request that
the department determine if a contribution to that entity
qualifies for the credit under this section. The department shall make a determination and respond to a request no later than
thirty days after receipt of the request.
On or before the first day of July of each year, the
department shall provide the speaker of the House of Delegates
and the president of the Senate with a report on the total amount
of tax credits claimed under this section and shall make
recommendations regarding the reform of tax laws that will
stimulate charitable giving and be equitable to all community
charities.
ARTICLE 24. CORPORATION NET INCOME TAX.
§11-24-11b. Credit for contributions to community foundations
and homeless shelters.
A taxpayer who does not claim a credit under the provisions
of section fifteen-a, article twenty-one, chapter eleven of this
code is allowed a credit, against the tax imposed by the
provisions of this article, of fifty percent of the amount the
taxpayer contributes during the taxable year to an endowment fund
of a community foundation or fifty percent of the cash amount the
taxpayer contributes during the taxable year to a shelter for
homeless persons, food kitchen, food bank, or other entity, the
primary purpose of which is to provide overnight accommodation,
food or meals to persons who are indigent if a contribution to
that entity is tax deductible for the donor under the Internal
Revenue Code.
The credit allowed by this section for a contribution to a
community foundation shall not exceed five percent of the
taxpayer's tax liability for the tax year before claiming any
credits allowed by this section or five thousand dollars,
whichever is less. For the one thousand nine hundred ninety-five
tax year and each tax year after the one thousand nine hundred
ninety-five tax year, a taxpayer may claim an additional credit
under this section not to exceed five percent of the taxpayer's
tax liability for the tax year before claiming any credits
allowed by this section or five thousand dollars, whichever is
less, for total cash contributions made in the tax year to
shelters for homeless persons, food kitchens and food banks.
The credits allowed by this section are nonrefundable so
that a taxpayer shall not claim under this section a total credit
amount that reduces the taxpayer's tax liability to less than
zero.
As used in this section, "community foundation" means an
organization that applies for certification on or before the
first day of April of the tax year for which the taxpayer is
claiming the credit and that the department of tax and revenue
certifies for that tax year as meeting all of the following
requirements:
(a) Qualifies for exemption from federal income taxation
under section 501(c)(3) of the Internal Revenue Code;
(b) Supports a broad range of charitable activities within
a specific geographic area of this state that it serves,
including a municipality or county;
(c) Maintains an ongoing program to attract new endowment
funds by seeking gifts and bequests from a wide range of
potential donors in the community or area served;
(d) Is publicly supported as defined by the regulations of
the United States department of the treasury, 26 C.F.R.
1.170A-9(e)(10);
(e) Is not a supporting organization as defined under
section 509(a)(3) of the Internal Revenue Code and the
regulations of the United States department of the treasury, 26
C.F.R. 1.509(a)-4 and 1.509d(a)-5;
(f) Meets the requirements for treatment as a single entity
contained in the regulations of the United States department of
the treasury, 26 C.F.R. 1.170A-9(e)(11); and
(g) Is incorporated or established as a trust before the
first day of September of the year immediately preceding the tax
year for which the credit is claimed.
An entity other than a community foundation may request that
the department determine if a contribution to that entity
qualifies for the credit under this section. The department
shall make a determination and respond to a request no later than
thirty days after receipt of the request.
On or before the first day of July of each year, the
department shall provide the speaker of the House of Delegates
and the president of the Senate with a report on the total amount
of tax credits claimed under this section and shall make
recommendations regarding the reform of tax laws that will
stimulate charitable giving and be equitable to all community
charities.
NOTE: The purpose of this bill is to allow a credit against
the West Virginia personal income tax and corporation net income
tax liability for taxpayers who contribute to community
foundations and homeless shelters and services.
§11-21-15a and §11-24-11b are new; therefore,
strike-throughs and underscoring have been omitted.