December 15, 2009
Director of Revenue Praises Efforts of Food Pantries; Promotes Use of Missouri's Food Pantry Tax Credit
JEFFERSON CITY - Alana M. Barragán-Scott, director of the Missouri Department of Revenue, visited two Missouri food pantries this week to make citizens and businesses aware of the opportunity they have to receive a tax credit for helping others in need.
"During these challenging economic times, one in seven head of households struggles to provide adequate food for their families," Barragán-Scott said. "As more people seek assistance, the dedicated staff and volunteers at food pantries all over the state are on the front line of providing hunger relief to the families that need it. Anything that can be done to promote the efforts of these food pantries is worthwhile, and the state's Food Pantry Tax Credit is one way that helps sustain their important mission."
Barragán-Scott visited the Visions Unlimited Food Pantry in Eldon on Monday and the Cherith Brook Food Pantry in Moberly on Tuesday.
The Food Pantry Tax Credit was established in 2007. It allows individuals or businesses to get a 50 percent tax credit for donations of cash or food to organizations that directly distribute emergency food supplies to low-income people as part of their mission. The food pantries or other groups must also be 501(c)(3) organizations (exempt from federal income tax) to qualify. Donations must be made directly to food pantries that distribute food, not to food banks that store food, to qualify for the tax credit. Most food banks also operate food pantries, but donors should contact their local food banks first to see if they qualify before a donation is made. A person associated with the food pantry must verify the donation.
According to the U.S. Department of Agriculture, about 17 million households find it difficult to feed all of their family members. These "food-insecure" households represent about 49 million (14.6 percent) of all U.S. households.
Barragán-Scott noted the unique and successful partnerships that come together when donations are made through the Food Pantry Tax Credit program.
"When a person or business donates to a food pantry, that individual or business gets a significant tax break," she said. "But that donation is then used by the food pantries at places such as churches, day care centers, soup kitchens, senior centers or domestic abuse shelters to help those in need. Getting a tax break is great, but knowing that you have started a cycle of giving that helps so many people is worth even more."
The director also noted that December is an especially appropriate time for citizens to consider giving to a food pantry.
"Although donations to food pantries can be made at any time of the year, the selfless act of giving is especially emphasized during the holiday season," Barragán-Scott said. "Making a donation such as this may be the best gift of all for the many recipients who will benefit from it."
The tax credit is for 50 percent of a cash contribution or 50 percent of the value of the food donated to a food pantry. For example, if a person donates $100 to an eligible food pantry, he or she gets a $50 credit on the amount of individual income tax owed to the state. The tax credit per individual or business is capped at $2,500, so only donations of up to $5,000 in cash or food apply to the tax credit. Returns claiming the tax credit must be filed by April 15. The total amount available for the tax credit in any one fiscal year is $2 million.
The Food Pantry Tax Credit can be applied not just to individual income tax, but also to corporate income tax or to the "fiduciary tax" assessed on estate interest income. It can't be applied to business sales taxes that are collected from customers and remitted to the state or to the "withholding tax" that businesses withhold from employee paychecks to pay for employees' state income tax obligations.
In the first two fiscal years that the tax credit has been in existence, 1,607 people or businesses have donated $1,389,926, which resulted in $694,963 in tax credits for Missouri citizens and businesses. The average donation was $864.91, and the average tax credit was $432.45.
For more information on the Food Pantry Tax Credit, go to http://dor.mo.gov/taxcredit/fpt.php. For answers to other questions about the tax credit, e-mail the Department of Revenue at [email protected] or call (573) 526-8733.
The Missouri Food Bank Association also provides information and links to food banks and pantries at www.feedingmissouri.org.