Donors that make a donation to a qualified permanent endowment fund held at an eligible institution of higher education may be eligible for a credit against the Maryland State income tax. The tax credit terminates December 31, 2023.
To qualify for the credit
Cash donations made by the taxpayer to a qualified permanent endowment fund that meet certain requirements are eligible for tax credits. Donations must be made to a qualifying fund at any of the following institutions: Bowie State University, Coppin State University, Morgan State University, or University of Maryland Eastern Shore. In each tax year, the Comptroller may award a maximum of $60,000 in tax credits to each of the four institutions.
How the credit is calculated
The credit is 25% of the value of a proposed donation to a qualified permanent endowment fund. The donor must apply to the Comptroller of Maryland for a certification of the donation.
Credit application procedure
Donors seeking the tax credit must apply to the Comptroller for a tax credit certificate in the calendar year that the donation is made.
Applications must be sent by e-mail and are approved on a first-come, first-serve basis until the maximum amount of authorized credits have been approved.
For tax year 2019, the HBCU Tax Credit Application will be accepted beginning July 1, 2019 at 8 a.m.
An acknowledgement letter is issued when an application for the proposed donation is received. Donors are required to submit documentation from the institution showing proof of donation within 30 days before a final tax credit certificate is issued.
Where to send applications
Applications are accepted by e-mail only; and should be sent to HBCUtaxinfo@comp.state.md.us
All fields on the application are required to be completed fully. Incomplete applications will not be processed.
How the credit is claimed
Donors claim the credit by including the certification at the time the Maryland income tax return is filed. Individuals that are eligible to claim the income tax credit and are not PTE members may elect to claim the credit using Form 502CR, instead of Form 500CR. However, a donor may not claim the credit on both Form 500CR and Form 502CR. PTE members that are eligible for the credit must claim it on the Business Income Tax Credit Form 500CR. Corporations and Fiduciaries that are eligible to claim the credit must use Form 500CR to do so.
A taxpayer claiming the credit is required to add back the amount of the credit claimed to Maryland adjusted gross income or Maryland modified income, to the extent excluded from federal adjusted gross income.
Comptroller of Maryland
HBCU Tax Credit Office