Legal Services and Access to Justice Tax Credit

Legal Services and Access to Justice Tax Credit. (a) A person may take cash contributions made during the tax year to qualifying nonprofit legal services organizations as a nonrefundable credit against the tax imposed by 4 CMC § 1201 and 4 CMC § 1202 to the extent provided by this Section. No such credit shall be allowed for any amount deducted in determining taxable income under the NMTIT as shown on the taxpayer’s return. The “tax imposed on wages and salaries or earnings” for purposes of computing the credit under 4 CMC § 1206 is the tax net of any credit taken pursuant to this Section. (b) The maximum credit available in any one year under this Section and 4 CMC § 1313 combined shall be the lesser of the sum of the taxes imposed under 4 CMC §§ 1201–02 and 4 CMC §§ 1301–04, or $5,000. Provided that a qualifying entity shall not receive more than $200,000 tax credit within a tax year. (c) The term “qualifying nonprofit legal services organization” under this section means nonprofit corporations that: (1) Have been issued a Letter of Determination granting tax-exempt status under Section 501(c)(3) of the Internal Revenue Code; and (2) Operates within the Commonwealth with a primary purpose of providing free or low-cost legal assistance to low-income or underserved individuals. (d) To obtain the credit, the taxpayer must furnish the following to the Division of Revenue and Taxation: (1) A properly documented receipt issued by the recipient institution which must include, at a minimum, the name and tax identification number of the institution, the taxpayer’s name and tax identification number, the date of payment and the amount paid, and the purpose of the donation; and (2) A copy of the Letter of Determination with respect to the tax-exempt status of the recipient institution. (e) Funds received by qualifying nonprofit legal services organizations pursuant to this Section shall be expended solely for the purpose of providing free or low-cost legal assistance to low-income or underserved individuals within the Commonwealth of the Northern Mariana Islands. The recipient organization shall certify compliance with this requirement in a form and manner prescribed by the Division of Revenue and Taxation. Source: PL 24-28, § 2 (Mar. 19, 2026).