It is easy to participate:

1- contact us, sign a form to reserve credits based on your donation amount (up to your total state tax liability).

2- you will be contacted when it is time to write your donation check. This will be when the state verifies that the credits are available and active in your name. (they will track the credits they are expecting to see on your tax return)

3- write the check and mail it according to instructions you receive.  We can also pick it up if that is more convenient.

4- Enter the credits on your tax return.  The credits offset tax you would owe. If you get $4,500 in credits, it would be just like you paid the state $4,500 in cash. You will receive a K-1 statement around February with the amount to enter on your return.

5- Receive your tax refund. Or, many participants count on the credits to avoid paying estimated taxes so they do not owe tax at the time of filing. 

You will receive a state tax credit for 90% of your donation. So, if you donate $10,000 you will receive a credit for $9,000 (90%).

You may also be eligible for a federal deduction for a charitable donation if you qualify. 

By state law, each donation must be used for a scholarship to a family that meets eligibiltity criteria outlined. (income, family size). 

BG is able to award 100% of EITC donations as scholarships. While a small portion can be used for administration expense, BG chooses not to do that.

So, every dollar you donate goes directly toward helping families afford to attend the school. 

This donation may qualify for a Federal charitable deduction. Please consult your tax professional. 

An SPE, or Special Purpose Entity, is vehicle recognized by the State of Pennsylvania as a pass through entity created specifically for the purpose of applying for, and distributing, EITC credits. 

This simplifies the administration for both participants and the State.  Each SPE applies for credits with the State and signs up donors who wish to receive the credits.

The SPE works with the state so each donor (taxpayer) is properly recorded and recognized. 

Without an SPE, a donor could apply directly to the state for credits but must meet strict deadlines and processes to receive and use the credits. This is typically not something a donor wishes to do. 

Yes, the state of Pennsylvania started the EITC program over 20 years ago and has expanded it since.  It is a line item in the state budget which provides these tax credits that we can access to help BG. It is in our interest to get as many of these credits as we can.

The state describes the program on its website and various other places. Tax preparers generally are familiar with the program, although many may not be up to date on the latest procedures which make participating very simple and easy. 

This program is the best way to donate – your dollars go farther and make a major impact. 

No. You will only be asked to write a donation check after the State verifies that it has your name and tax ID/ssn in their records as being awarded a credit. They will anticipate seeing the credit amount on your tax return. 

The State of Pennsylvania has a form called “PA Credits – OC” which stands for “other credits.”  This form lists credits available for state taxpayers, and EITC is on the list.  You can easily find the form online or ask your tax professional. 

The EITC program awards credit for 75% of your donation amount if you choose to participate for only one year and 90% if you commit to participating for 2 years.  We are able to offer credits for 90% because almost all donors particpate for 2 (and more) years. If you have a one-time high income year, we usually can still find ways to get you 90% credit. Please contact us to discuss. 

Your donation amount equates to your PA state tax. If you are a business you may be paying estimated taxes and already know your expected state tax liability.

If you are an individual, your employer would be withholding state taxes from your paycheck.  With the state tax rate of 3.07% you can estimate the taxes you pay but you can also see it on your pay stub or prior year tax return. 

Possibly, yes.  If you pay estimated taxes you may be able to factor the tax credits into the amount of your quarterly payments. If you are a w-2 employee, you may be out of pocket the amount of your donation until you receive your tax refund.  However, in the second and following years of participation, your tax refund can go toward the next year donation so you would be out of pocket mainly in the first year. 

No, we do not and cannot provide tax or legal advice.

Nothing from the school or on this site should be seen as providing advice.

Please consult your tax or legal professional

Please contact our consultant, Jeff Wilson, who can work with you to clear up any questions or issues.  While not common, there have been times we have helped clear up things like a delayed tax refund.