AAA Scholarship Foundation (AAA) is a 501 (c)(3) nonprofit organization and state approved Opportunity Scholarship Organization (OSO) that exclusively serves eligible low-income children through the Opportunity Scholarship Tax Credit Program which allows any company that pays Pennsylvania corporate net income tax, capital stock franchise tax, bank and trust company shares tax, title insurance companies share tax, insurance premiums tax, or mutual thrift institution tax to annually redirect up to $750,000 of those tax payments to AAA in order to fund K-12 education scholarships for eligible, low-income children.
Your company will receive a tax credit of 75 percent of its redirection for a one year commitment to AAA or it can increase that tax credit to 90 percent for a two year commitment.
The process to enroll is very simple.
- Complete the application through the Department of Community and Economic Development’s Single Application for Assistance website (http://dced.pa.gov/programs/opportunity-scholarship-tax-credit-program-ostc/).
- Type in “AAA Scholarships” as the Project Name then click the Yellow Button “Create a New Application” on the bottom of the page.
- Scroll toward the bottom of Page 3 until you see “Opportunity Scholarship Tax Credit” and click “Apply”.
- Complete the application with your company information, select “Statewide” as the County on the second page of the application then click “Submit Application” on the third page.
You may apply more than once for credits during the year for a maximum of $750,000. It’s important to remember that the approval process does not oblige you to remit the funds to AAA-it is merely a way for the DOR to ensure that the annual maximum ($50 million for 2016) in tax credits is not over-subscribed.
The PA DOR will send you an approval letter. Once approved, remit your payment directly to AAA via check, wire or ACH within 60 days of the date of the approval letter.
Once the remittance is received, AAA will promptly return an acknowledgement for each remittance (known as a Certificate of Contribution) to your company. It will list the name of the company remitting the funds, the company’s tax ID number, the amount of the remittance and the date of the remittance (please remember that the payment must be made within 60 days from the date of approval by the PA DOR). Submit a copy of the Certificate of Contribution to the PA DOR within 90 days of the date of the approval letter.
For state tax purposes the 75 or 90 percent credit should be reported as an “Educational Improvement Tax Credit” on the respective state corporate tax form. Please note that any state tax liability remaining after the credit is netted should be paid as normal estimated tax payments to the Pennsylvania DOR.
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