PA Tax Credit Programs
If you could direct your taxes back to your community
and make a difference in a child’s life, wouldn’t you?
In Pennsylvania, the Educational Improvement Tax Credit (EITC) and Opportunity Scholarship Tax Credit (OSTC) programs allow you to do just that. If you pay state taxes in Pennsylvania, you can make a contribution to Kentucky AVenue School and receive 90% of that contribution back in the form of a tax credit. It costs a dime to give a dollar.
Funds from EITC and OSTC go directly to our need-based financial aid program, supporting students who would otherwise not be able to afford Kentucky Avenue School. Working together with local business partners and individual donors, we can achieve truly remarkable things in our school, our community, and our city.
Businesses paying PA taxes complete an online application each year to the Department of Community and Economic Development or join an SPE. Awards are received on a first-come, first-served basis and within 60 days, the contribution must be made to an approved educational organization. A business owner can participate in both: as a business applying directly to PA (C-Corp, LLC, LLP, etc.) and as an individual through an SPE. The SPE allows the PA tax liability to flow through it for the purpose of participating in the EITC/OSTC program. The SPE makes the application to the Commonwealth on behalf of the members.
If you or your business (C-Corp, S-Corp, LLC, or Partnership) is subject to one or more of the Pennsylvania taxes outlined below, you are eligible.
It really couldn’t be easier. Contact Ellen McConnell Sanderson at firstname.lastname@example.org or 412-361-5332.
Individuals/households with an annual income of $115,000 or more or a PA personal income tax liability of $3,500+ annually can qualify for this program. Check line 12 of your PA Income Tax Return to confirm your PA Tax Liability amount.
For individuals or couples (married filing jointly), one must work for a business, own a business, or own stock in a company that does business in the state of Pennsylvania. Individuals may live outside of PA and still participate if they own such stock. You must have PA State Tax Liability.
Retirees may own a small business (receive an annual K-1 form), work for a business (receive an annual W-2 form), or own stock in a company that does business in the state of PA. Some retirees qualify due to side jobs or residual ownership of businesses and some do not. We can help you confirm your qualification status. Retirees may live outside of PA and still participate if they own stock in a company that does business in the state of Pennsylvania. You must have PA State Tax Liability.
Step 1: Consult your tax advisor to confirm eligibility.
Step 2: Estimate your PA Tax Liability for two years. A two-year commitment for the same amount is required.
Step 3: Request and complete the SPE joiner agreement.
Step 4: You will receive notification of the tax credit award approval and need to send in a check within 60 days.
Step 5: The SPE immediately passes 100% of your contribution to Kentucky Avenue School, 100% of which supports our school’s needs-based financial aid program.
Step 6: The SPE completes all required tax and accounting paperwork. The SPE will send a K-1 partnership form to you by the end of February which indicates your tax credit.