PA Education Tax Credit Program

 

Tax Credit Program

 

How Does it work?

Act 4 of 2001 amends the Public School code to authorize tax credit for businesses that make contributions to scholarship or educational improvement organization.

Who is Eligible?

A business who pays PA corporate taxes and / or PA capitol stock tax, will benefit from these credits. Normally, a C corporation, however, in some cases a Sub S corporation may be paying PA capitol stock tax.

What does it cost the business?.

NOTHING!

For example, A business pays $ 21,000 in PA net income and capital stock taxes each year.  The business decides that it wants to make a 2 year commitment to contributing $20,000 each year to Keystone SMILES’ Community Learning Center for a total of $40,000 in contributions.  Since the business is willing to commit to contributing for 2 years, they receive PA tax credit of 90%, up to $100,000.  If the business decides to make a one year commitment, they receive a 75% tax credit up to $100,000.

2-year commitment @ $20,000/ year = $40,000 total 

$40,000 * 90% tax credit = $36,000  tax credit

 

1-year commitment @ $20,000/ year

$20,000*75% tax credit = $15,000 tax credit

 

Additionally, the business is able to take charitable deduction for the contribution on both their federal and state income tax returns.  Therefore, this costs the business nothing, they actually pocket cash by participating in the program.

Eligible businesses that wish to make a contribution must submit a completed application to the Department of Community and Economic Development.  Tax Credit applications will be processed on a first come, first serve basis by day submitted; applications will be processed until the amount available in tax credits is exhausted.

 

How to apply?

Any business that is interested, we can help.  We will gladly assist you in preparing the paperwork.  For more information, please contact Joyce Fosdick, Executive Director of Keystone SMILES, at (814) 797-1174

 

Businesses that pay these taxes will also benefit...

ó Bank and Trust Company Shares Tax

ó Alternative Ban and Trust Company Shares Tax

ó Title Insurance Company Shares Tax

ó Alternative Title Company Shares Tax

ó Insurance Premiums Tax

ó Mutual Thrift Institutions Tax