Tax Credits Help Keep Non-Profits Operational
BOONE COUNTY - The Missouri Department of Economic Development (MDED) gives out two categories of tax credits, business development tax credit programs and community tax credit programs. One type of community tax credit is the Youth Opportunities Program (YOP). A YOP tax credit benefits both the donor and the agency. It is used to offset an eligible donor's income tax liability and to enable the donor to redirect his Missouri tax dollars to local projects.
Over the past two years, the MDED has given out $5,287,132 in tax credits. But tax credits are not cash.
"A tax credit is, let's say you are one of the people donating to one of these agencies and you got a certain amount of tax credit funds back to you, what that means is your state income tax is decreased by that much next year," MDED Director of Communications John Fougere said.
Last August, the MDED approved Coyote Hill Christian Children's Home for state tax credits under the YOP. Coyote Hill received $249,566 of Missouri state tax credits.
"The tax credits really encourage larger business gifts and that is important because of what Coyote Hill does in the community," Coyote Hill founder Larry McDaniel said.
Coyote Hill also receives funding from donations and what it calls "Parent Partners." Parent Partners are individuals or businesses that support Coyote Hill on a monthly basis. Coyote Hill said these donations are very important for the financial stability of work with the children and their families.
Larry and Cathy McDaniel founded Coyote Hill Christian Children's Home in 1991. With their experience in foster care, they realized there was a tremendous need for a professional home of love that was able to address the social and emotional issues, in addition to the physical ones of food, shelter, and clothing for children who have been neglected or abused.
"These kids have never got to be a child," McDaniel said. "We just try to make everything here be an effective to help a kid be a kid and have a safe place to do it."
Coyote Hill is located about 20 minutes north of Columbia on 200 acres . The property has four homes. Each home has over 5300 square feet, and is designed to work with up to eight children in each home.
Coyote Hill offers physical support and education, as well as individual, spiritual and emotional growth.
"[Without the tax credit] we would not be as far reaching because the tax credit enables us to build another home," McDaniel said.
Not just any agency is eligible for YOP tax credits. There are five different types of groups that are eligible for YOP tax credits. The first group includes non-profit organizations, Coyote Hill's status. There are also local governments, Missouri businesses, schools and faith-based organizations.
Any individual, LLCs, partnerships, banks or corporations that have Missouri tax liability are eligible for YOP tax credits. Donors have up to one year from the date of their contribution to complete the application process. They then have up to 5 years to use the credits to offset state income tax liability. Credits cannot be more than the donor's liability in the tax year they are claimed.
A donor may receive a maximum of $200,000 in credits.
For more information on Missouri tax credits visit here.