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Donor Communication Guide

Organization Communication Material(s) Guidance

This guide is intended to provide nonprofits with information and topics to consider when creating introduction communication materials for their donors about participation in HCTC. This document is meant to serve as a guide and nonprofits should customize the information at their discretion for their organization’s materials.

Please keep in mind that you do not have to use all of this information in your materials. Detailed information for donors is included in the HCTC Taxpayer Handbook and additional information can always be added at the nonprofit’s discretion.

What is HCTC?

The Colorado Homeless Contribution Income Tax Credit provides a state income tax credit to Colorado taxpayers who contribute to eligible homelessness-related projects within Colorado. Created by Colorado House Bill 2022 - 1083 (HB22-1083), HCTC replaces the Enterprise Zone Tax Credit previously available for donations to approved homeless support organizations. This is a new tax credit that began January 1st, 2023.

How can donors opt into receiving a tax credit?

  • Do they need to add HCTC to the memo line of a check?
  • Is there a section in your online donation portal where they can indicate they wish to receive a homeless contribution tax credit?

What is the minimum donation amount for donors to qualify for HCTC?

  • HCTC has the following minimum donation requirements.
    • Monetary/Cash: $100+
    • In-Kind: Must be appraised at over $5,000
  • Does your organization have a different cash minimum set? Please inform your donors of the accurate amount if the minimum differs at your organizations.
  • Example phrasing for cumulative donations: “Cash gifts of $100 or more can qualify for HCTC, including cumulative gifts that total $100 or more by the end of the tax year.”

How much is your project’s tax credit amount?

  • 25% for non-rural projects
  • 30% for rural projects

Which projects/programs qualify for HCTC at your organization?

  • HCTC recommends listing the name of your qualified project.
    • If you have a project that encompasses multiple programs at your organization, you can consider listing these under the HCTC qualifying project name. However, this is not required.
  • Do all programs qualify at your organization?
  • Do you have a capital campaign that is approved with HCTC?

When will a donor receive their certificate?

  • Immediately?
    • Do you want to express a timeline for when they can expect to receive their certificate after they’ve given their donation?
  • Quarterly?
    • Quarterly certificates will be available after the following dates: May 1st (Q1), August 1st (Q2), November 1st (Q3), February 1st (Q4).
  • Annually?
    • All annual certificates must be distributed between February 1st - 15th.

What personal information is required to receive the tax credit?

Tax ID and other personal information is used by the Department of Revenue to verify identity. Tax ID requirements to receive the tax credit include:

  • Social Security Number (SSN) and Individual Taxpayer Identification Number (ITIN): last four digits
  • Federal Employee Identification Number (FEIN): full nine digits

Who does the donor contact regarding HCTC matters at your organization?

  • Name, email, and phone number of your organization’s main HCTC point of contact staff.
  • Please do not direct donors to DOH staff.

Other resources that will be helpful to donors:

Additional Recommendations (more detailed):

How are tax credit certificates distributed?

  • Via secure email
  • Via postal mail

What qualifies as an in-kind donation?

In-kind contributions can include a contribution of property, services, stocks, bond, or other intangible property.

What other personal information may be required?

  • First and last name as it appears on your tax return
  • Taxpayer ID: SSN or ITIN (for individual household’s contributions) or FEIN (if contributing from a business)
  • Street address
  • E-mail (required for email access to certificate but optional if the nonprofit issues the certificate via postal mail)
  • Phone number (optional for DOH)

Templates

Templates provided in this guide are meant to be a starting point for nonprofits to use in their donor communication materials. Nonprofits are strongly encouraged to customize the templates below, if they choose to use them, to fit their needs and best communication practices with donors.

Informational Text

[Organization Name] is a participating Homeless Contribution Tax Credit (HCTC) organization! The Colorado Homeless Contribution Income Tax Credit provides a state income tax credit to Colorado taxpayers who contribute to eligible homelessness-related projects within Colorado. Our project(s)/program(s), [Project Name(s)], is an approved eligible project to receive the tax credit. Donors who give monetary gifts of [$100] or more OR in-kind gifts of over $5,000 are eligible to receive a [25% or 30%] state income tax credit. This can include cumulative gifts that are given by the end of the tax year.

All donors who give eligible contributions can opt into this tax credit by [putting HCTC in the memo line of a check/writing it in the comments when sending an online contribution/etc.]. Colorado statute (C.R.S. 39-22-548) states that the Tax ID information (last four digits of ITIN or SSN, or, full nine-digit FEIN) is required to be on the distributed tax credit certificate and entered at the time that the contribution is submitted. The required Tax ID information according to Taxpayer Type and other personal information is used by the Department of Revenue to verify identity. [Insert information on how your organization will collect Tax IDs - if applicable/desired].

[Organization Name]’s donors will receive their tax credit certificate on an [immediate/quarterly/annual] basis. If you have any questions regarding HCTC, please contact [staff’s contact information]. For more information about the new HCTC program, visit the HCTC website.

Bullet Points

[Organization Name] is a participating Homeless Contribution Tax Credit (HCTC) organization! The Colorado Homeless Contribution Income Tax Credit provides a state income tax credit to Colorado taxpayers who contribute to eligible homelessness-related projects within Colorado. The information below provides details about [organization]’s participation in this program and how it can benefit you!

  • [Approved projects] at our organization and donations given to those projects qualify for HCTC.
    • This credit is optional for all donors. You can opt into receiving the tax credit by....
  • Monetary gifts of [$100] or more or in-kind gifts of over $5,000 are eligible.
  • The income tax credit of [25% or 30%] will be given to qualifying donations.
  • A donor’s Tax ID information must be provided in order for a tax credit certificate to be issued.
    • SSN or ITIN: last four digits
    • FEIN: full nine-digits
    • The Tax ID requirements and other personal information are used by the Department of Revenue to verify identity.
    • The Colorado Revised Statutes establishing HCTC and this requirement can be found under the C.R.S. 39-22-548.
  • Tax credit certificates will be issued on an [immediate/quarterly/annual] basis.
    • Certificates will be distributed via secure email. If a donor does not have an email or prefers not to use the email feature, the certificates will be sent via postal mail.

If you have any questions regarding HCTC, please contact [staff’s contact information]. For more information about the new HCTC program, visit the HCTC website.

This form should be used to report problems or issues with this website. Questions pertaining to a program or service provided by DOH should be addressed to contact information located on the specific program pages.

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