FAQ

(prepared by the Oregon Department of Revenue and the Cultural Trust)

The following examples and chart provides guidance, individual tax circumstances may be different. These examples assumes a couple is filing jointly and is eligible for the maximum Cultural Trust tax credit of $1,000.  A single file is eligible for a maximum of $500.

The Cultural Tax Credit is a nonrefundable credit. The credit cannot be carried over to another tax year and only applies to your State of Oregon tax liability for the year when you make your contribution. However, the tax credit can be used to help reduce a filer’s tax to pay. For example, a $500 tax credit may help reduce a $1,200 tax liability to $700.

Itemizing Guidance (not including the Trust tax credit as a federal tax deduction)

If the joint filers are in the federal 32% rate and 9% rate for Oregon and donate a total of $1,000 to eligible cultural nonprofits, they are eligible to claim deductions for $320 tax savings on the federal return and $90 for state return.  The taxpayers tax saving would be $410.

If the same taxpayers also contributed $1,000 to the Cultural Trust, and that amount is not claimed as a deduction on federal tax returns, the contribution is eligible for the Trust tax credit. The Oregon tax saving would be $1,000.

The total combined tax savings would be $1,410.  The taxpayers gave a total of $2,000 to cultural nonprofits and the Trust and total cash outlay was only $590.

Standard Deduction Guidance (itemize deductions on the Oregon return only)

If the joint filers are in the federal 32% rate and 9% rate for Oregon and donate a total of $1,000 to eligible cultural nonprofits and do not itemize on their federal return they are not eligible to claim those contribution to cultural nonprofits as deductions on their federal return.  There would be no tax savings for these donations if they are claiming the standard deduction.  The contribution of $1,000 would be eligible as a deduction the Oregon tax return, the tax savings would be $90.

If the same taxpayers also contributed $1,000 to the Cultural Trust, and that amount is not claimed as a deduction on federal tax returns, the contribution is eligible for the Trust tax credit. The tax saving would be $1,000.

The total combined tax savings would be $1,090.  The taxpayers gave a total of $2,000 to cultural nonprofits and the Trust and total cash outlay was only $910.

No Itemized Deduction on federal or state taxes

If the joint filers do not itemize on either federal or state taxes they may not claim the donations to cultural nonprofits on either tax returns. There would not be a tax savings.

If the same taxpayers also contributed $1,000 to the Cultural Trust, and that amount is not claimed as a deduction on federal or state tax returns, the contribution is eligible for the Trust tax credit. The tax saving would be $1,000.

The tax savings would be $1,000.  The taxpayers gave a total of $2,000 to cultural nonprofits and the Trust and total cash outlay was only $1,000.

Exception

If your contribution to the Trust is above the maximum tax credit limit, you can claim the amount over the limit as a deduction on your state and federal returns as long as you itemize on both returns.  For example: If you are eligible for a maximum $1,000 Trust tax credit and you donate $1,500 to the Trust, you can claim the $1,000 Trust tax credit and the over amount of $500 on your federal and Oregon tax returns.

Why doesn’t every Oregonian do this?

Most Oregonians don’t know about it, or think it’s complex to do. But making a matching contribution and claiming it on your tax return is very easy. Some might also forget to make their donation before Dec. 31.

The Oregon Cultural Trust is a tax-exempt organization under Chapter 170(c)(1) of the Internal Revenue Code and our tax id number is 93-0621491.

The contribution to the Trust can either be claimed as a deduction on your federal taxes OR as an Oregon state Trust tax credit. You cannot claim the state tax credit and also deduct it on your federal tax return. See below for examples.

Exception

If your contribution to the Trust is above the maximum tax credit limit you can claim the amount over the limit as a deduction on your state and federal returns as long as you itemize on both returns.  For example: If you are eligible for a maximum $1,000 Trust tax credit and you donate $1,500 to the Trust, you can claim the $1,000 Trust tax credit and the over amount of $500 on your federal and Oregon tax returns.

Itemizing Guidance

If you itemize your deductions and you include the contribution to the Trust that contribution  is eligible as a deductible on your federal income tax return. If you claim the Trust contribution as a deduction on your federal returns, you will need to add that amount back to your taxable income on  your Oregon tax returns.
Standard Deduction Guidance

If you do not itemize your deductions on your federal income tax return, you are eligible to claim the Trust tax credit on your Oregon returns up to the allowable limit.

Oregon taxpayers should consult with their accredited tax preparer regarding the availability to take the deduction on the Federal return while also taking a credit on the Oregon return for the same donation.

Yes, but they are generous: up to $500 for an individual, $1,000 for couples filing jointly and $2,500 for Class-C corporations. You must have Oregon tax liability in order to claim the tax credit. You can claim the tax credit year after year, but you cannot carry it forward from one year to the next. If you do not itemize your deductions on your federal income tax return, you may still claim the Oregon cultural tax credit on your state returns up to the allowable limit. Oregon taxpayers should consult with their accredited tax preparer regarding the availability to take the deduction on the Federal return while also taking a credit on the Oregon return for the same donation.

Yes, although many Oregon taxpayers will likely take the standard deduction due to recent change in tax law, while still choosing to support charitable cultural nonprofits with a donation. Even if you choose not to itemize your taxes, you can make a matching gift to the Cultural Trust for a 100% state tax credit. Be sure to consult with your tax preparer for which approach best suites your financial situation. A gift to a cultural nonprofit and the Cultural Trust remains a win-win!

The cultural tax credit is claimed using code 807 on Schedule OR-ASC, Section C, Standard Credits, or Schedule OR-ASC-NP, Section E. This amount is carried over onto the tax return using the following lines: Form OR-40, line 25; Form OR-40-N, line 50; or Form OR-40-P, line 49 (N stands for non-residents, P stands for part-time residents).

Users of Tax Software: In the list of “Standard Credits,” you’ll see “Oregon Cultural Trust.” Enter the amount you gave to the Cultural Trust there. It might also be referred to as the “Cultural Development Fund“.

Turbo Tax users: In your Oregon State return it is listed under “Uncommon Oregon Credits.” Check the box next to “Donated to an Oregon nonprofit and the Trust for Cultural Development Account.”

Trust donors should consult a tax preparer should they have any questions about their unique filing circumstances.

Please note the FAQ section describes how the Cultural Trust tax credit works; tax information and examples from the Oregon Cultural Trust is intended for use as a guide and not as official tax advice. Individual tax circumstances may be different. The Cultural Trust cannot provide tax advice and cannot assume authority in tax matters. Oregon taxpayers should consult with their accredited tax preparer when planning their charitable giving.