An Example:
The following is one example of what can happen by investing your state
income tax liability in local projects:
You
have a Colorado State Tax liability of................................................................................... $5,000.00
If
you make Contribution(s) to local EZ project(s) totaling $10,000, you will
receive a 25% tax credit of (2,500.00)
Your
net tax benefit from Schedule A of your federal return allows you a state
deduction of 4.63%,
which is ......................................................................................................................................... (463.00)
Leaving
you a net Colorado liability of........................................................................................ $2,037.00
You
receive an additional federal benefit from Schedule A for your contribution deduction
of. $10,000.00
Multiplied
by the federal tax rate of.................................................................................................... 28%
Which
gives you a net federal tax benefit of................................................................................ $2,800.00
Your
total contribution of........................................................................................................... $10,000.00
Gives
you a reduction of Colorado state tax liability in the amount of........................................ (2,963.00)
And
a reduction of your federal tax liability in the amount of .................................................... (2,800.00)
The
net cost of your $10,000 contribution(s) to local EZ project(s) as a taxpayer
is...................... $4,237.00
Remember-this
is just an example of what can happen. You
should contact your own tax preparer
for specific benefits related to your individual contribution(s). Gifts of
property or stocks also may qualify for tax credits.
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