Taxpayers in New York State have the opportunity to support important causes while receiving a valuable tax credit through the Contributions to Certain Funds Credit. This credit allows individuals, partnerships, and certain trusts to reduce their state tax liability by contributing to designated charitable funds that support health research, education, and public impact initiatives.

At Basso & Guida, we help clients navigate state-specific tax credits to ensure they maximize every possible tax advantage. In this guide, we’ll break down who qualifies for this credit, how much you can claim, and what documentation you need to provide.

Who Is Eligible for the Contributions to Certain Funds Credit?

This credit is available to individual taxpayers, partners in a partnership, and beneficiaries of estates or trusts who contribute to designated charitable funds.

Eligibility is based on the timing and type of contributions:

• If you contributed in the tax year immediately prior to the one you’re filing for, your donation must have gone to:
  • The Charitable Gift Trust Fund, which includes:
    • The Health and Charitable Account
    • The Elementary and Secondary Education Charitable Account
• If you contributed in the tax year you are filing for, your donation must have been made to one of the following:
  • Health Research, Inc.
  • State University of New York (SUNY) Impact Foundation
  • Research Foundation of the City University of New York (CUNY)

If you made qualifying contributions to any of these funds, you may be entitled to claim the credit on your New York State tax return.

How Much Is the Credit Worth?

The Contributions to Certain Funds Credit allows taxpayers to claim 85% of the total contributions made to qualifying funds.

For example:

• If you contributed $10,000 to an eligible fund, you would receive an $8,500 tax credit against your state tax liability.
• If you contributed $25,000, you could claim $21,250 as a credit on your tax return.

Important Note: This is a nonrefundable credit, meaning it can only be used to reduce your New York State tax liability—it will not result in a refund beyond what you owe.

What Are the Recordkeeping Requirements?

To claim the credit, taxpayers must maintain accurate records and provide proof of contributions to the designated funds.

Acceptable documentation may include:

• Official receipts or acknowledgment letters from the organization that received the contribution.
• Bank statements or canceled checks showing the transaction.
• Confirmation from the charitable fund that the contribution was processed and allocated correctly.

During an IRS or New York State audit, you may be required to substantiate your claim with detailed documentation. For specific guidelines, review the Checklist for Acceptable Proof of the Contributions to Certain Funds Credit provided by the state.

How to Claim the Credit

To claim the Contributions to Certain Funds Credit, taxpayers must file Form IT-228 along with their New York State tax return.

• For individuals and estates/trusts: Use Form IT-228, Contributions to Certain Funds Credit
• For partnerships: The credit is passed through to partners, who must report it on their personal tax return

It’s always best to work with an experienced tax professional to ensure you are filing correctly and maximizing your credits.

Why This Credit Matters

The Contributions to Certain Funds Credit benefits both taxpayers and the greater community by encouraging donations to critical research and education initiatives.

• Encourages Philanthropy: Taxpayers can support public health and education while lowering their tax bill.
• Provides a Significant Tax Benefit: An 85% credit means you can dramatically reduce your state tax liability while giving to a worthy cause.
• Supports Research & Education: Contributions go toward health advancements, scientific research, and student programs across New York State.

By taking advantage of this credit, you’re not only making a positive financial decision but also investing in the future of health and education in New York.

How Basso & Guida Can Help

At Basso & Guida, we specialize in helping individuals and business owners navigate complex tax credits to ensure they maximize their savings.

• Review your eligibility for the Contributions to Certain Funds Credit
• Ensure all documentation is properly recorded to support your claim
• Help you file Form IT-228 and optimize your tax return
• Identify additional tax credits that could further reduce your tax burden

If you’ve made charitable contributions and want to ensure you’re getting the maximum benefit, let us help you take full advantage of this credit.

📞 Schedule a Consultation to review your tax situation and optimize your deductions today.

Final Thoughts: Claim Your Tax Savings While Giving Back

The Contributions to Certain Funds Credit is an excellent way for New York taxpayers to support charitable causes while lowering their state tax liability.

By keeping accurate records and filing the correct forms, you can:

• Reduce your tax burden by 85% of your contribution
• Support essential health research and education initiatives
• Maximize your tax savings while making a difference

If you’ve made contributions to qualifying charitable funds, don’t miss out on this tax-saving opportunity. Contact Basso & Guida today, and we’ll ensure you get the full benefit of every dollar you give.