North Dakota
Tax Credit
North Dakota 40% Tax Credit for Charitable Giving
The State of North Dakota encourages charitable giving by offering individuals and businesses a 40% tax credit for qualifying gifts. Gifts from individuals must be placed in a qualifying endowment. The tax credit is 40% of the charitable deduction, up to $10,000 per individual or $20,000 per joint filer. The credit may be carried forward for three years.
This unique tax credit also applies to planned or deferred gifts (e.g. charitable trusts, gift annuities, life insurance policies, etc.) to a qualified ND charitable nonprofit or a qualified ND endowment.
More information: www.tax.nd.gov
North Dakota Higher Education Challenge Match
The North Dakota Higher Education Challenge Fund is transforming campuses like Lake Region State College. It inspires philanthropy to support North Dakota colleges.
Matching dollars encourage donors to give, which is crucial for smaller campuses. These gifts have grown the college’s foundation significantly. Since the program began over 10 years ago, the Community College Foundation supporting LRSC grew from $4.6 million to over $14 million. Scholarship numbers and amounts have increased, and program support has helped LRSC remain competitive.
The Challenge Grant Fund has strengthened the college’s named endowment program, enhancing scholarships and programs. Many donors increased the size of existing endowments. In 2024, funding from endowments and other sources provided scholarships totaling over $540,000, nearly double the amount a decade ago. Endowments supporting programs have enabled faculty to continuously improve student learning outcomes.
State Tax Credit for Planned or Deferred Gifts
Individuals may receive a state tax credit for planned gifts, like charitable remainder trusts, gift annuities, or life insurance policies. These gifts must be made to a qualified North Dakota charitable nonprofit or endowment.
The tax credit equals 40% of the IRS charitable deduction, up to $10,000 per taxpayer or $20,000 per couple. Effective for taxable years starting in 2007.
Definitions under
State Law
Qualified nonprofit organization: A North Dakota 501(c)(3) organization with a business presence in the state, eligible for tax-deductible contributions.
Qualified endowment: A permanent fund held by a qualified nonprofit. It is invested to generate income for a specific charitable, religious, or educational purpose.
See N.D. Century Code 57-38-01.21 and 57-35.3 for details.