Education Improvement Tax Credit Gives Incentive to Help KidsPeace

If your business is looking for a philanthropic opportunity, KidsPeace participates in a state program that can make it even more worthwhile to donate. The Educational Improvement Tax Credit (EITC), established by the Pennsylvania Department of Community and Economic Development, provides an incentive for companies to support select local non-profit charities.

A business that makes a contribution to KidsPeace through the EITC receives a tax credit equal to 75 percent of its contribution up to a maximum of $300,000 per taxable year. Your credit can be increased to 90 percent of the contribution if your business agrees to provide the same amount for two consecutive tax years.

Companies eligible for the tax credit are those who 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; or Personal Income Tax of S Corporation Shareholders or Partnership Partners.

Applications for fiscal year 2012-2013 will be accepted starting July 2 at DCED Center for Business Financing, Tax Credit Division, Fourth Floor, Commonwealth Keystone Building, 400 North St., Harrisburg, PA 17120. Applications are approved on a first-come-first-served basis.

To apply, an interested business should send the Pennsylvania DCED a one-page application for the tax credit. After the DCED reviews the application and confirms there is money available in the program, tax credits will be awarded. Once an approval letter is received, businesses must make their contribution(s) within 60 days. Upon receipt of the contribution, KidsPeace will provide substantiation of the donation, and the business simply files this with the DCED to complete the process. The business is then able to claim the tax credit on its subsequent state tax filing. Specific procedures for business owners electing to pass through the EITC to individual tax returns are found in the application packets.

For more information on how your business can participate, visit the donation section of our website or contact Patrick Slattery, KidsPeace Director of Advancement, at 610-799-8326 or patrick.slattery@kidspeace.org. You may also contact the PA DCED at 717-787-7120 or RA-EITC@pa.gov.