The Montana Endowment Tax Credit (METC) lets your clients reduce state income taxes while supporting the nonprofits they care about.
The credit is 40% of the charitable portion of a qualified planned gift, up to $15,000 credit for individuals and $30,000 for married couples filing jointly. Gifts must be made with cash or appreciated stock, and the credit must be used in the year the gift is made.
Donors may also qualify for a federal charitable deduction. Donating highly appreciated stock can offer an additional advantage by avoiding capital gains tax.
How It Works at Whitefish Community Foundation
To follow state laws and maximize tax benefits, Whitefish Community Foundation (WCF) structures METC gifts as deferred charitable gift annuities. The deferred structure creates the highest allowable deduction for the donor. The assets are invested for a minimum of five years, after which the donor relinquishes their remaining annuity interest. The gift, plus investment earnings, is then transferred to the permanent endowment(s) designated by the donor, providing annual distributions to the selected nonprofit(s) in perpetuity.
One Family’s Approach to Maximizing the METC
Many WCF donors take advantage of the METC annually, while others use it during a year with a one-time significant financial event, such as selling a property or business.
One family has made annual gifts of stock purchased decades ago at a very low cost basis. By donating appreciated shares, they maximize their Montana tax credit each year while avoiding capital gains tax on the donated stock.
The family has a particular nonprofit they wish to see succeed over time, and they have directed all of their METC gifts to its permanent endowment. Over time, the endowment is projected to exceed $1 million, creating a lasting source of support while allowing the family to save a substantial amount in Montana income taxes and minimize their out-of-pocket cost.
What This Means for Your Clients
The METC offers valuable planning opportunities across several professional disciplines:
- For Attorneys: Consider the METC when helping clients develop estate plans, establish charitable legacies, or incorporate philanthropy into long-term wealth transfer strategies. It can be particularly valuable for clients who want to support a favorite nonprofit beyond their lifetime while receiving tax benefits today.
- For CPAs: Look for opportunities when clients face significant Montana income tax liabilities, particularly during high-income years or following a major financial event, such as the sale of a business or property. The METC can provide meaningful state tax savings while potentially complementing federal charitable deductions.
- For Financial Advisors: Consider the METC when reviewing clients' investment portfolios, particularly those holding highly appreciated stock. Gifting appreciated securities can help clients achieve philanthropic goals, reduce concentrated positions, and potentially avoid capital gains taxes on donated appreciation.
A Resource for You and Your Clients
Whitefish Community Foundation holds more than 55 qualified Montana endowments and facilitated 31 METC gifts totaling $1.3 million in 2025.
You know your clients' financial, tax, and estate planning needs. We know charitable giving. Together, we can help clients maximize tax benefits while creating lasting support for the nonprofits they care about.
2026 is coming to a close and we encourage you to reach out early. WCF offers complimentary charitable planning consultations and welcomes the opportunity to work alongside you and your clients.
Download the Information Sheet
We developed an informational sheet detailing the Montana Endowment Tax Credit. Click below to download this free resource for you and your clients.
