Educational Tax Credit
Educational Improvement Tax Credit Programs:
Act 4 of 2001, as amended, authorizes tax credits for businesses that make contributions to educational improvement organizations. Quiet Creek Herb Farm & School of Country Living, Inc. is recognized as an educational improvement organization by the Pennsylvania Department of Community and Economic Development (DCED). Additional information is available on the website www.newpa.com searching for the Educational Improvement Tax Credit Program. Tax credits are authorized for contributions to educational improvement organizations. Tax credits may be applied to the Corporate Net Income Tax, Capital Stock Franchise Tax, Bank and Trust Company Shares Tax, Title Insurance Company Shares Tax, Insurance Premiums Tax or Mutual Institutions Tax.
Tax credits (K-12) are limited to 75% of the business contribution, with a maximum of $200,000 annually.If a business agrees to make the same contribution to an organization for two consecutive years, it may receive a tax credit (K-12) equal to 90% of its contribution, again up to $200,000 annually. Tax credits are awarded to businesses on a first come, first served basis. The guidelines provide the process and forms for businesses to apply for tax credits. They are found in a packet available at www.newpa.com Because these tax credits are awarded on a first come, Claire Orner will help you electronically send your applications to Harrisburg so that your business and Quiet Creek Herb Farm & School of Country Living, Inc. have the best chance of being awarded these tax credits and tax dollars, respectively, to benefit local school students from Brockway, Brookville, Clarion, Clarion-Limestone, DuBois, Keystone, and Punxsutawney.
Additional Information is available at this link:
https://dced.pa.gov/programs/educational-improvement-tax-credit-program-eitc/
Uses
Tax credits may be applied against the tax liability of a business for the tax year in which the contribution was made.
Funding
Tax credits equal to 75 percent of its contribution up to a maximum of $400,000 per taxable year. Can be increased to 90 percent of the contribution, if business agrees to provide same amount for two consecutive tax years. For contributions to Pre-Kindergarten Scholarship Organizations, a business may receive a tax credit equal to 100 percent of the first $10,000 contributed and up to 90 percent of the remaining amount contributed up to a maximum credit of $200,000 annually.
Eligibility
Businesses authorized to do business in Pennsylvania who are subject to one or more of the following taxes:
- Corporate Net Income Tax
- Capital Stock Franchise Tax
- Bank and Trust Company Shares Tax
- Title Insurance Companies Shares Tax
- Insurance Premiums Tax
- Mutual Thrift Institution Tax
- Personal Income Tax of S corporation shareholders or Partnership partners
An approved company must provide proof to DCED within 90 days of the notification letter that the contribution was made within 60 days of the notification letter. Tax credits not used in the tax year the contribution was made may not be carried forward or carried back and are not refundable or transferable.
How to Apply
Pennsylvania businesses can begin applying for EITC credits through DCED’s electronic single application system. DCED will no longer require applicants to mail the signed signature page.
The business application guide explains the process of applying. Tax credit applications will be processed on a first-come, first-served basis by day submitted. All applications received on a specific day will be processed on a random basis before moving on to the next day’s applications. Applications will be approved until the amount of available tax credits is exhausted.
DCED Center for Business Financing
Tax Credit Division
4th Floor
Commonwealth Keystone Building
400 North Street
Harrisburg, PA 17120 (717)-787-7120 or RA-EITC@pa.gov
