What is EITC?
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 a commitment to making the same donations for two consecutive years is made. A business paying taxes in Pennsylvania can receive up to $750,000 in tax credits annually. EITC provides low-income children and families, who reside in Philadelphia, with much needed tuition assistance.
What is OSTC?
Modeled after the popular EITC program, the Opportunity Scholarship Tax Credit (OSTC) program provides tuition assistance to children who live within the attendance boundaries of Pennsylvania’s worst performing 15% of schools. Just like the EITC program, the OSTC program awards Pennsylvania businesses a tax credit of 75% if the gift is made for one year or 90% if the company commits to making the same donations for two consecutive years. OSTC funds are available in addition to any credits received under the EITC program and you can apply for both programs at the same time with a short application.
SPS offers tuition assistance annually to approximately 25% of families. Many of these families are in the boundaries of an underperforming school district, which gives us flexibility in accepting EITC or OSTC. We, along with many local independent schools, partner closely with Business Leadership Organized for Catholic Schools (BLOCS) to manage and receive our EITC/OSTC funds. BLOCS is an experienced, long-standing participant in the program and we are grateful for their assistance.
Available for Businesses or Individuals
EITC and OSTC are open to both businesses and individuals. Any business that pays PA taxes and individuals making over a given threshold in PA state tax (typically in the $5,000+ range but it can vary from year to year) is eligible to participate in the program.