Bar Bulletin

December, 2004

Combine Your Pro Bono Responsibilities
With the Benefits of Tax Credits

By Russell P. Butler

Attorneys desiring to utilize charitable contributions to complete their pro bono responsibilities now have a way to maximize their contributions. Pro bono obligations can be satisfied by contributing to organizations that provide legal services to persons of limited means. If you select a legal services program that has been designated by the State to provide tax credits through the Community Investment Tax Credit Program (CITI), attorneys can donate more at a lesser cost and receive the benefits of tax credits. CITI encourages Maryland businesses to support non-profits. Donating through CITI allows attorneys to target the impact of their charitable contributions on participating programs to maximize the benefit of a pro bono financial donation.

Pro Bono
Obligations/Reporting

Under the ethical rules for attorneys, a lawyer has a professional responsibility to render pro bono publico legal service, which may be satisfied by a financial contribution to organizations that provide legal services to persons of limited means (rules are found at www.courts.state.md.us/probono/probonorules.html). Eligible Maryland legal service organizations to which you can financially contribute to help satisfy your pro bono obligations can be found at www.courts.state.md.us/probono/mlsc_providers.pdf.
While attorneys are not required to complete pro bono hours in Maryland, reporting pro bono is mandatory. The Maryland Rules require all Maryland licensed attorneys to file annual Pro Bono Legal Service Reports indicating the number of hours of pro bono service they rendered or contributions they made to legal services organizations in the previous year.

How CITI Tax Credits
Program Works

Non-profits organizations apply for tax credit allocations through the State of Maryland. Once approved, business entities that donate directly to non-profits for approved projects receive tax credits equal to 50 percent of the value of the donation. These tax credits are in addition to the normal federal and state deductions for full amount of the charitable deductions. Contributions under CITI must be of at least $500 in face value. Requesting the tax credit is simple. Businesses, including sole proprietors and partnerships, need only complete a one-page form to the non-profit.

100-Plus Available
CITI Projects

The State of Maryland has designated over 100 eligible projects. Listed online at www.mdhousing.org/citi, those wishing to contribute under CITI can determine eligible non-profits. For more information regarding participating in the CITI program, you can review www.dhcd.state.md.us/npp/index.asp or call Crystal Davenport at the Department of Housing and Community Development at (410) 514-7236 or (800) 756-1009. To determine the net economic cost of your charitable contribution, you need to consult your tax attorney or your CPA.

Maryland Crime Victims’
Resource Center, Inc.

A legal service provider participating in the CITI program, the Maryland Crime Victims’ Resource Center, Inc. (MCVRC), assists victims in the aftermath of crime. Originally formed as the Stephanie Roper Foundation and Committee, MCVRC strives to implement its mission of providing crime victims with comprehensive victims’ rights and services. With funding from the Maryland Legal Services Corporation, MCVRC’s Crime Victim Legal Advocacy Program provides needed information and legal services to crime victims. MCVRC is one of a few select, approved non-profit organizations to also offer CITI tax credit contributions.

Have You Completed Your
2004 Pro Bono Obligations?

The end of 2004 is at hand, and you will soon receive the paperwork regarding completion of your 2004 pro bono obligations from the Administrative Office of the Court. If you have not yet completed your pro bono obligations or you want to do more, there is still time. Before the end of the year, you may not only further your pro bono obligations through a charitable deduction but also at the same time receive a CITI tax credit for your contribution.

Tax Credits Allow You to
Contribute More at a
Lesser Economic Cost

Without considering the tax advantages of your federal and Maryland tax deductions for charitable deductions, CITI’s tax credits program reduces the cost of your contribution by half. However, considering the available federal and Maryland tax deductions, your contribution costs you even less. Thus, you can determine both the gross and net amount of your charitable deduction to calculate the total impact of your contribution, both to you and the non-profit.

Maximize the Benefits of
Your Charitable Contribution

Many people contribute to charitable causes for altruistic reasons. Some attorneys may donate as part of their professional responsibility requirements. Others may contribute because of the tax benefits they receive. Regardless of the reasons for making a charitable contribution, you should consider all of the potential benefits to maximize the impact of your charitable contribution. CITI tax credits provide important economic benefits for you to consider when determining your charitable contributions.


Russell P. Butler is Executive Director of the Maryland Crime Victims’ Resource Center, Inc. in its Upper Marlboro office. He is also the current Chair of the MSBA Criminal Law and Practice Section Council.

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Publications : Bar Bulletin: December, 2004

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