Denver Public Schools Foundation is a 501(c)(3) nonprofit organization. Donations made to DPS Foundation are tax-deductible to the full extent of the law. Please consult with your tax adviser about the tax deductibility of your gift.
Colorado Child Care Contribution Credit
You deserve credit for your support of Denver Public Schools afterschool programs!
The Colorado Child Care Contribution Credit was designed to promote child care in Colorado. A 50% state income tax credit may be available to individual and corporate donors who direct a monetary contribution to Denver Public Schools Foundation’s after school programs.
Denver Public Schools Foundation will provide a signed statement of the amount of the monetary contribution eligible for this credit. Letters are issued no later than January 31 following the contribution year. The donor must make this statement available to the Colorado Department of Revenue upon request.
Effective January 1, 2018, gifts of $250 or more restricted for afterschool programs may be eligible for a 50% Colorado state income tax credit.
IMPORTANT UPDATE: The federal Department of Treasury and Internal Revenue Service (IRS) released a final rule on June 13, 2019 regarding federal tax treatment of charitable giving when donations also generate state and local tax credits. The rule took effect August 12, 2019.
An individual taxpayer claiming the charitable deduction may not deduct the portion of a donation that generates a state or local tax credit. There is a safe harbor provision, however. Individual taxpayers can deduct the value of the tax credit under the State And Local Taxes (SALT) deduction up to the $10,000 cap.
- An itemizing taxpayer who makes a $1,000 donation to a child care facility and claims the 50% Child Care Contribution Credit ($500) on Colorado taxes would only be able to claim $500 of the donation as part of the taxpayer’s federal charitable deduction. However, the taxpayer could claim the remaining $500 as part of the taxpayer’s SALT deduction if SALT liability is less than $10,000.
- A non-itemizing taxpayer who makes a $1,000 donation to a child care facility and claims 50% Child Care Contribution Credit would still be able to claim this 50% credit on state taxes ($500). Because the taxpayer claims the standard deduction, the taxpayer would not be able to deduct the contribution on federal taxes under the charitable deduction or SALT deduction.
Guidelines for Donations
- Donors must designate, in writing, either on the check, pledge card or by letter, the contribution is for afterschool programs in Denver Public Schools.
- A minimum gift of $250 is required to qualify for the credit.
- The Colorado Child Care Contribution Credit is limited to $100,000 annually, not to exceed the tax liability for the year. Any excess credits may be carried forward for up to five years.
- In-kind and stock contributions do not qualify for this credit.
- Contributions must be paid before December 31, 2024, to qualify for this credit under existing law.
- All donors should consult a tax advisor regarding the calculation of the credit.
- Denver Public Schools Foundation will provide you with the necessary documentation for your tax records.
Please consult with your tax adviser about the tax-deductibility of your specific gift. For more information, call (720) 423-3553.