AN ACT to allow a tax credit for charitable contributions by a taxpayer that elects to take the standard deduction.

The General Assembly of North Carolina enacts:

SECTION 1.  Part 2 of Article 4 of Subchapter I of Chapter 105 of the General Statutes is amended by adding a new section to read:

§ 105‑153.11.  Standard deduction charitable contribution tax credit.

(a)        Credit. – A taxpayer who, for the taxable year, deducts the standard deduction amount provided in G.S. 105‑153.5(a)(1) and makes charitable contributions under section 170 of the Code is allowed a credit against the tax imposed by this Part equal to twenty‑five percent (25%) of the charitable contributions.

(b)        Limitations. – A nonresident or part‑year resident who claims the credit allowed by this section shall reduce the amount of the credit by multiplying it by the fraction calculated under G.S. 105‑153.4(b) or (c), as appropriate. The credit allowed under this section may not exceed the amount of tax imposed by this Part for the taxable year reduced by the sum of all credits allowed, except payments of tax made by or on behalf of the taxpayer.

SECTION 2.  This act is effective for taxable years beginning on or after January 1, 2023.