The EITC program has a proud history of furthering the education of Pennsylvania’s schoolchildren since the program’s inception more 10 years ago.
On May 7, 2001, by an overwhelming bi-partisan majority, Pennsylvania made history by becoming the first state to pass an education tax credit aimed at corporations.
HB 996, the Educational Improvement Tax Credit (EITC), provides companies with a 75% tax credit for donations to a non-profit scholarship or educational improvement organization. The tax credit increases to 90% if the company commits to making the same donations for two consecutive years. A business paying taxes in Pennsylvania can receive up to $300,000 in tax credits annually. More importantly, the EITC provides children and families with a choice in their education and a chance in life.
Scholarship Organizations provide scholarships to children to attend the schools of their choice.
Educational Improvement Organizations fund innovative programs in public schools across the Commonwealth.
Pre-K Scholarship Organizations fund scholarships to children so families have the ability to choose the pre-K that best fits the needs of their child.
A Great Way for Businesses to Direct Their Tax Dollars
The EITC has accomplished what many in Pennsylvania have been advocating for years: to get the business community more involved in education. The EITC enables companies to support local non-profit charities, at minimal cost, instead of sending their tax dollars to Harrisburg. It’s that simple.
The business community has overwhelmingly responded the challenge. To date, over 3,600 companies have pledged in excess of $350 million dollars to the programs. The children of Pennsylvania thank you!
A Lifeboat for Kids, a Savings to Pennsylvania Taxpayers
EITC scholarships have provided thousands of lifeboats to families looking to escape failing public schools, as well as to families struggling to remain in non-public schools. Each time a child moves from a public to non-public school and each time a child is able to stay in a non-public school as a result of the EITC, both taxpayers and families win! One study has already documented savings of $360,000 dollars annually to the Philadelphia School District as a result of the Futuro Educacional scholarship organization.
Historic Timeline of the Pennsylvania Educational Improvement Tax Credit
2010 EITC funding held at $75 million thanks to the efforts of REACH supporters
2009 Reduced EITC by $13.2 million and Pre-K EITC by $1.6 million
2008 Expanded business caps to $300,000 (from $200,000) for EITC and $150,000 (from $100,000) for Pre-K EITC; added sub-chapter S corporations and other pass-through business entities to be able to participate in program
2007 Expanded EITC by $13 million and Pre-K EITC by $3 million
2006 Expanded EITC by $10 million
2005 Expanded EITC by $4 million; gained legislative language protecting families and participating organizations from intrusive and over-burdensome reporting requirements
2003 Expanded EITC by $10,000; added $5 million Pre-K EITC program; expanded business caps to $200,000 (from $100,000) per state fiscal year
2001 Successfully gained passage of Educational Improvement Tax Credit (EITC) — the nation’s first corporate tax credit program ($30 million)