Projects: North Central Kansas Rural Business Tax Credit Initiative: Frequently Asked Questions

Q. Why should I consider purchasing 75% state tax credits from the North Central Regional Planning Commission?

A. Most businesses and many households pay some form of state income tax every year to the Kansas Department of Revenue with the taxpayer having little control over just how that money is subsequently spent. Purchase of 75% state tax credits from the North Central Regional Planning Commission gives the tax payer the alternative of redirecting some of their state tax obligation to North Central Kansas as a means of helping advance the economic growth of their home region.

Q: What is the minimum amount I or my company must contribute in order to participate in the initiative?

A: $ 250.00 is the minimum. There is no maximum limit.

Q: Who is eligible to purchase the credits?

A: All persons or tax paying entities obligated to pay Kansas state income tax.

Q: How do I or my company benefit from making the donation other than through the economic growth of North Central Kansas?

A: The best way of answering that is by example. Assuming you make a $1,000.00 donation and you itemize deductions on your federal tax return, you automatically recover $750.00 through application of the Kansas tax credits plus the potential deduction you receive from the IRS specific to the charitable donation itself. The following table provides illustration.

NOTE: All donors should check with their personal financial planner or accountant to ensure they have the correct numbers.  The table above is just an example of how things might work.

Q:  Do the credits carry forward into the next tax year if the contributor’s state tax obligation in the current year does not equal the amount of credits received?

A:  No.  These credits cannot be carried forward.  However, the state will issue you a check for that portion of the credits purchased which go unneeded in the current tax year.  For example, if you donate $1,000.00, you receive tax credits valued at $750.00.  If your tax obligation for the current year is $500.00, you are allowed to claim $500.00 through credits and the state issues you a $250.00 check so you recover the entire $750.00.