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(McCook, NE) Gov. Dave Heineman held the first of three ceremonial signings of LB 28 to promote a program that offers state income tax credits for qualified individual and corporate donations to non-profit organizations with endowments based in Nebraska. The Governor also plans promotional stops in Ord and Lincoln later this month.
“This program encourages people and businesses to endow Nebraska with a future of new promise and private growth,” Gov. Heineman said. “We are doing all we can at the state level to stimulate the economy, and this is another tool, an incentive, if you will, for the private sector to invest in the future of the places they live, work and do business.”
Sen. Matt Connealy of Decatur, who introduced LB 28, joined the Governor, Sen. Tom Baker of Trenton and state and local representatives in touting the potential benefits of this endowment program to non-profit organizations such as regional economic development cooperatives and foundations for community colleges, universities and community improvement. In all, 22 senators signed on to sponsor the bill.
The bill creates state income tax credits of up to $10,000 a year for planned gifts to qualified 501(c) 3 non-profit organizations. Corporations can deduct 20 percent of their total contribution, up to the $10,000 annual cap. Individuals can deduct 30 percent, up to that amount. The law goes into effect on Jan. 1, 2006, and expires Jan. 1, 2010.
According to the most recent available figures, 11 states offer donation tax credits similar to the ones prescribed for Nebraska in LB 28. Other states, such as Montana, have seen the positive impacts from incentives for charitable giving. Recent reports indicate that $74 million has been added to the endowments of Montana non-profits in five years, according to EndowNebraska. The organization’s current estimates show that $94 billion in wealth will be transferred between generations over the next 50 years in Nebraska.
Sen. Connealy said, “LB 28 provides another way for communities to help spur economic development. It is imperative that we keep building wealth in our communities by ensuring the continued ownership of our assets. This new credit will encourage Nebraskans to think first of Nebraska non-profits when they make their charitable giving decisions.”
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