What is An Enterprise Zone?
In 1986, the Colorado legislature created enterprise zones as a way to assist businesses and non-profit organizations located in economically depressed areas throughout the state. This legislation makes it possible for the Good Neighbor Garage to offer its donors a 25% Colorado state income tax credit on cash contributions of $1,000 or more. Over the years, this program has proven to be of great value both to Good Neighbor Garage and its supporters.
- Donors make a contribution by check ( or online), $1,000 minimum amount to $400,000 maximum amount.
- Donors must indicate Enterprise Zone on the memo line of the check OR make their donation on our Enterprise Zone donation page.
- Within 60 days, Good Neighbor Garage will send the donor the appropriate paperwork for tax purposes.
- Decreases donor’s state tax liability through a 25% state tax credit for cash gifts and 12.5% for in-kind contributions such as stocks (there must be a state tax liability).
- Provides the opportunity for donors to help more people in need by decreasing the net cost of their contribution.
Increase the Tax Credit for In-Kind Contributions
Gift-In-Kind contributions of stocks or bonds are eligible for a tax credit of 12.5%. Qualified cash gifts made during the calendar year equal to 1/7th the combined amount of all qualifying in-kind donations will increase the tax credit value to the full 25%. To receive the full 25% tax credit for in-kind donations, the total amount of all qualifying cash gifts made to any Enterprise Zone charity must equal 1/7th of the combined value of all qualifying in-kind donations made to any EZ charity in that calendar year. A detailed explanation of these conditions can also be found on the Colorado Department of Revenue website at www.colorado.gov/revenue/tax.
Here is How you give and keep more:
There may be a substantial tax benefit for donations made to Good Neighbor Garage through the Enterprise Zone. The net after-tax benefit for a gift of $1,000 is $630. In this way a gift of $1,000 costs only $370 after taxes.
Enterprise Zone Example: The impact on income tax costs given the scenario of a contributor in the 33 percent federal tax bracket who gives a gift of $1,000:
Tax benefits of donation
Charitable Donation Deductions
Combined Charitable Donation Deductions ($380)
Colorado State Enterprise Zone Tax Credit ($250)
Total Tax Benefits of Donation ($630)
Cost of Donation After Combined Tax Benefits
The above example is for illustrative purposes only. Please consult your tax professional or CPA to relate this to your particular circumstances. Specific net after-tax benefit for the same gift will differ based on individual tax situations.