“How’d you like to save money on your business’s tax bill while at the same time help kids in your neighborhood get the best education they deserve?”That is the question the Pennsylvania Catholic Conference (PCC) and other education advocates are asking qualified businesses around Pennsylvania. To date, approximately $8 million are still available in the Educational Improvement Tax Credit (EITC) program.
The EITC program provides a tax credit of up to 90 percent for companies that donate to non-profit scholarship and educational improvement organizations – many of which help students at Catholic schools. During the 2006-07 school year, over 33,000 children received EITC scholarships. Since the programs inception in 2001, more than 2,300 Pennsylvania companies have participated in the EITC program donating over $260 million to participating organizations.
Over $67 million in tax credits have already been awarded, but $8 million in total tax credits remain available to businesses that want to contribute to scholarship programs. “Tax credits are not deductions,” said Dr. Robert J. O’Hara, Executive Director of PCC. “A tax credit is an actual reduction in the amount of tax a business will pay. In essence, a business can pay its taxes directly to the Commonwealth, or, by making a donation, substantially reduce its tax liability while helping families and building community good will.”
To be eligible for a tax credit, a business must pay at least one of the following taxes: Corporate Net Income Tax; Capital Stock and Franchise Tax; Bank and Trust Company Shares Tax; Title Insurance Companies Shares Tax; Insurance Premiums Tax; and the Mutual Thrift Institutions Tax. To receive its tax credit, the business simply needs to submit its one-page application to the Department of Community and Economic Development (DCED). After approval by DCED, businesses must make their contribution(s) within 60 days.
The EITC program is a great benefit to Catholic schools. Each diocese in Pennsylvania has its own scholarship organization; and, there are scholarship organizations associated with other private or religious schools all across the Commonwealth.
“This is a unique government program where everybody wins,” added O’Hara. “Businesses can direct their tax dollars to go toward something good right in their backyard and families are empowered to make choices when it comes to educating their children. It’s a good deal!”
To learn how your business can take part in this program and create educational opportunities for local students, please contact the scholarship organization in your diocese or log on to the REACH Foundation website at www.paschoolchoice.org for more details.
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PCC Column February 2008 by A. B. Hill, Communications Director of the Pennsylvania Catholic Conference – the public affairs arm of Pennsylvania’s Catholic bishops and the Catholic dioceses of Pennsylvania.
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EITC K-12 or Pre-K EITC – Two ways for businesses to participate
Contributions to K-12 Scholarship Organizations = Tax credits equal to 75% of the contribution up to a maximum of $200,000 per taxable year; but this is increased to 90% of the contribution, if business agrees to provide same amount for two consecutive tax years.
Contributions to Pre-Kindergarten Scholarship Organizations = a business may receive a tax credit equal to 100% of the first $10,000 contributed and up to 90% of the remaining amount contributed up to a maximum credit of $100,000 annually.
Log on to www.paschoolchoice.org for more details and a list of scholarship organizations.
