Wednesday, October 30, 2013

Report on Education Tax Credits for Donations to K-12 Scholarship Funds

Tax creditThe Foundation for Opportunity in Education just released its analysis of the 13 states that have laws granting tax credits to individuals and businesses that donate to private school scholarship funds. The analysis includes not just a discussion of the amount of the tax credit, but a thorough discussion of how the scholarship funds must be managed and the extent to which the private schools that enroll the scholarship recipients must comply with testing, non-discrimination, and other regulation.  These later details are probably the most interesting to equity minded readers, as the concern with some scholarship programs was that they might be used to cheat the tax system.  For instance, a parent might not recieve a tax credit for paying their child's tuition, but if they donated to a foundation and they foundation then gave that parent's child a scholarship, the parent theoretically might receive a tax deduction for the donation.

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