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State and Federal Tax Credits for donors who support affordable housing
Providing safe, decent homes with an affordable mortgage results in strong and stable families; and strong and stable families result in strong and stable communities. This is an amazing gift in and of itself, but did you know that donors who support Greater Albuquerque Habitat for Humanity (GAHH) can take advantage of a generous tax credit?
The State Tax Credit Program provides tax credits to individuals and businesses making donations to affordable housing projects approved by the New Mexico Mortgage Finance Authority (MFA). Currently, GAHH’s 8-home Mesa del Rio Project is approved.
All donations to the Mesa del Rio Project of $1,000 or greater are eligible to receive a New Mexico state tax credit from GAHH. The Tax Credit is equal to 50% of the value of the donation and can be used –as a direct credit on personal and corporate income tax returns.. In addition to the New Mexico tax credits, a taxpayer can also claim the standard charitable deduction on the federal tax return.
How it works
A taxpayer with a combined federal & state tax rate of 40% can earn back 90% of his or her contribution in tax credits & deductions. A donation of $1,000 to GAHH, receives a $500 state tax credit, and a $400 federal deduction. GAHH receives $1,000 to build homes for low income families in our community and the taxpayer’s end cost is $100.
A Real Example
In August of 2014 a new Habitat family moved into their first home. One of the generous sponsors for the home was Ron, a longtime Habitat volunteer and donor. His family’s contribution toward building affordable housing gave him the opportunity to take advantage of state tax credits.
“The tax credit was never a determinate of whether I would give to Greater Albuquerque Habitat, but rather an incentive that encourages me to increase my gift and make a bigger impact,” said Ron. “Because of the tax credits, Habitat receives an increased contribution, larger than what I could typically give. I can even carry that credit forward on my taxes for up to 5 years.”
Donors are essential to our mission to build decent, affordable homes right here in the Albuquerque community. Habitat homes are the result of collaborative efforts by Habitat homeowners, volunteers, corporate sponsors, individual donors, a group of volunteers known as SWAT, and private foundations.
“I started volunteering with Sandia Labs and then I was invited to join the SWAT team,” said Ron. “After building several houses, seeing the joy on the homeowner’s faces and hearing one girl tell me that she’s going to go to bed and not be afraid at night anymore, I began to realize the impact we have as a volunteers and a donors.”
Donations of money and time are critical to ensuring that we can continue to provide affordable homes with low-mortgage rates and zero interest loans to families struggling to make ends meet.
“As a donor, it may only seem like I have helped one family, but really I have helped all the generations to come in ways we can’t realize,” added Ron. “By helping a family purchase a home of their own, we are changing the cycle of poverty for their children and future generations.”
Tis the season of giving. Make an End of Year Donation
With the end of year right around the corner, it’s the perfect opportunity to make a donation and benefit from a tax credit at the same time.
Any donation restricted to the Mesa del Rio project of $1,000 or more is eligible. You can make an online donation now or mail a check to Greater Albuquerque Habitat for Humanity, 4900 Menaul NE, Albuquerque, NM 87110, attention Beth Goldman.
If you mail a check, please write state tax credits in the memo. We will contact you to sign the state tax credit application before the end of the year.