(2023)
What is meant by an endowment to the "capital base" of a foundation?
Endowments thus increase the foundation capital (asset pool), meaning they are not spent and remain with the foundation. Naturally, an endowment sustainably improves a foundation's income situation.
Endowments are more generously supported by the legislator than "normal" donations: Contributions to a foundation's asset pool are deductible as special expenses up to an amount of 1 million Euro (see § 10 b para. 1a EStG). It does not matter whether it is an existing or newly established foundation.
The donor determines how the contribution is distributed across the individual assessment periods from year to year with their corresponding applications within the specified ten-year period. This special expense deduction is available again every ten years, but only for individuals subject to income tax or partners in partnerships; not for taxable corporations.
