Educational Improvement Tax Credit (EITC) and Opportunity Scholarship Tax Credit (OSTC) Programs
- Both the EITC and OSTC Programs allow qualifying businesses in PA to redirect a portion of its state tax funds to educational foundations of its choice.
- C-Corporations and pass-through entities, such as S-Corporations, partnerships, LLC’s, etc., are all eligible to participate!
- Your business’ redirected tax dollars can serve as transformative tuition scholarships.
- Many participating businesses also receive a deduction on federal taxes.
- A business receives a 75% tax credit for a one-year commitment and a 90% tax credit for a two-year commitment.
- Eligible businesses qualify if it pays one or more of the following state taxes:
- Personal Income Tax
- Capital Stock / Foreign Franchise Tax
- Corporate Net Income
- Bank Shares Tax
- Title Insurance & Trust Company Shares Tax
- Insurance Premium Tax (excluding surplus lines, unauthorized, domestic/foreign marine)
- Mutual Thrift Tax
- Malt Beverage Tax
- Check with your accountant to see whether your business qualifies. Then contact Janell Maglowski: firstname.lastname@example.org
Special Purpose Entity (SPE)
Individuals now have the opportunity to participate fully in the EITC and OSTC Programs by joining a Special Purpose Entity. Qualifying individuals must:
- Earn yearly income of at least $115,000 and owe at least $3,500 in state income taxes (receive W-2 wages from a for-profit business or own a for-profit business)
- Benefits include:
- PA tax credit for up to 90% of the SPE commitment (must renew annually)
- Federal charitable tax deduction of at least 10% (possibly more) of the federal charitable donations deduction
- Check with your accountant to see if you qualify. Then contact Janell Maglowski: email@example.com