The Community Foundation: A Charitable 501(c)(3) Organization

The IRS defines the Community Foundation of Northeast Iowa is as a charitable, non-profit 501(c)(3) organization. This means that the Community Foundation is a public charity that receives a substantial part of its income, directly or indirectly, from the general public or from the government.

Tax Benefits of Giving to a 501(c)(3) Organization

Under IRC Section 170, individuals giving to a 501(c)(3) organization that is a public charity (e.g. the Community Foundation of Northeast Iowa) may deduct contributions representing up to 50% of the donor's adjusted gross income (AGI) if the individual itemizes on his tax returns. Corporations may deduct all contributions to 501(c)(3) organizations up to an amount normally equal to 10% of their taxable income.

Tax Benefit Example

The chart below gives an example of the deduction for a single person in each tax bracket making a cash donation of $100 to the Community Foundation of Northeast Iowa. When filing your taxes, the instructions for the Form 1040 will help you determine the exact amount of your deduction, which will vary depending on your tax bracket and whether you file as a single person or jointly.

Tax Bracket	Donation Amount	Benefit	Out-of-Pocket Cost
10%	$100	$10	$90
15%	$100	$15	$85
25%	$100	$25	$75
28%	$100	$25	$72
33%	$100	$33	$67
35%	$100	$35	$35