Tax Credits for Donations Funding K-12 Scholarships for Eligible Students.
This Act establishes new federal tax credits for individuals and corporations donating to nonprofit organizations that provide K-12 educational scholarships. The goal is to expand educational choices, including private and religious schools, for students whose household income is up to 300% of the area median income. Importantly, the scholarships received by eligible students are exempt from federal income tax.
Key points
New Tax Credit: Individuals can claim a tax credit equal to the greater of $5,000 or 10% of their adjusted gross income for contributions to scholarship organizations.
Scholarship Eligibility: Financial aid is targeted at students from households earning up to three times the area median income, covering tuition, books, supplies, and tutoring expenses.
Tax-Free Scholarships: Scholarship funds received by eligible students for qualified education expenses are excluded from their gross income.
Protection of Autonomy: The law explicitly prevents federal or state governments from controlling or discriminating against participating private or religious schools and scholarship organizations.
Expired
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