By Kathleen Quinn
Deadline-driven U.S. taxpayers had an extra weekend this year to file state and federal income tax returns.
While filling the seemingly ceaseless boxes on the state tax form, taxpayers might have noticed the option to check a box and donate part of their refund or make a separate contribution to a charitable cause.
In 1977, Colorado was the first state to introduce “checkoff” boxes on the state tax return to facilitate contributions to nongame and endangered wildlife preservation, known as the “chickadee checkoff” on some state income tax forms.
Since then, the practice of using state income tax forms for charitable contributions has flourished and is now used by the 41 states with a broad-based income tax and the District of Columbia. In 2003, the Federation of Tax Administrators (FTA) counted 220 checkoff programs. By 2016, this number has nearly doubled to 413 programs.
The number and type of checkoff programs each state offers are as varied as the states themselves. Oregon offers the most robust list, with 30 programs included on its 2016 income tax return. However, three additional states follow close behind, each offering more than 20 checkoffs.
Nebraska and West Virginia are the only states that offer just one checkoff program (Nongame Wildlife Preservation and Child Abuse Prevention, respectively).
Since the FTA’s last survey of checkoff programs conducted in 2003, states have added an average of five checkoff programs to their personal income tax forms. The greatest growth occurred in New Jersey where the number state of checkoff boxes grew from nine programs in 2003 to 28 programs in 2016.
The most popular checkoff programs are:
- Nongame wildlife preservation (30 states)
- Child abuse prevention (23)
- Cancer research (22)
- Veteran’s pprograms (19)
- Military relief (18)
- Political party/clean election contributions (16)
- Special Olympic programs (8)
- State park preservation (8)
Some checkoff programs are unique to a specific state. From 2000-2014, Wisconsin’s income tax form included a Green Bay Packer’s Football Stadium checkoff box to help raise funds for the stadium’s $295 million renovation project. California has included a Sea Otter Fund checkoff since 2007. The Olympic training center in Lake Placid, New York, home to the 1980 Winter Olympics, still holds a place on New York’s checkoff contributions. Additionally, while not a checkoff contribution, Maine gives its residents the option to purchase state park passes in the checkoff portion of their tax return.
While certain states boast a variety of programs, other states hold the spotlight for the most generous checkoff donations. In tax year 2014, Californians donated approximately $5.3 million to 19 different programs. North Dakotans contributed $60,000 to two programs. In most other states, taxpayers donated less than $1 million to their checkoff programs.
Although, state income tax checkoff contributions have grown in popularity since their inception in 1977, they create a number of administrative challenges for state governments. These include determining processes to add or remove checkoffs from state income tax forms, as well as higher administrative costs for processing forms. Twelve states now list their checkoff contributions on a separate form, which increases the processing time, cost, and the possibility for errors.
For many Americans, April 15th (or 18th) still brings a strong feeling of deadline anxiety, but we can all breathe a little easier knowing that charitable giving is as simple as checking a box.
(Image credit: Iowa Department of Natural Resources)
Kathleen Quinn is a research analyst in NCSL's Fiscal program.
Email Kathleen