Making a Contribution as a Business

Keep your tax dollars at home & support your local community

Signed into law in 2008, the Education Tax Credit Program allows individuals and businesses to make scholarship contributions for deserving Georgia students. Contributors may designate which school(s) receive the scholarship funds, but cannot determine which particular student(s) receives a scholarship.

C-Corporations or Trust

Discover the convenient and consistent way for your business to contribute to educating Georgia’s children.

Did you know?

A C-corporation or trust is eligible to receive up to 75% of annual Georgia income tax liability in state tax credits.
two young students looking at book from teacher

Frequently Asked Questions

How much can an C-corporation or trust contribute?

Up to 75% of its Georgia state tax liability.

Can the tax credit be claimed each quarter?

Any person or business paying quarterly estimated taxes has the option to claim 25% of the contribution amount against each quarterly payment.

Can the tax credit be carried forward?

Yes, any unused portion of the tax credit can be carried forward for up to five years.

Can the tax credit be used for previous years liability?

No, the tax credit can only be carried forward.

Can I designate that my contribution will provide a scholarship for particular students?

No.  The law is very clear that you can designate your contribution to benefit a particular private school(s) in Georgia, but that you can not direct it to specific students. 

Can I choose to support more than one school with my contribution?

Absolutely.  Just make that notation during the contribution process and designate how you'd like the funds to be divided and we'll honor your wishes.

Am I required to choose a school(s)?

No. If you'd like to help students no matter which Georgia private school they choose to attend, we have an Undesignated Fund.  We utilize this fund to provide scholarship assistance to those eligible students who will not be attending a school that we otherwise have funds available for.

How do I make my contribution?

Please see How to Contribute.

What percentage of a contribution is used for scholarships?

The law requires that a minimum of 92% of contributions be awarded to eligible students as scholarships.

Request to Contribute

To request to contribute to scholarships for Georgia Students, use the form below.
 

Education Tax Credit Form -

C-Corps

Complete All Fields

 
 
 
 
 
 
 
 

Primary Contact Information

Contribution Information

Designated to a particular school or schools.
Undesignated (The ASF Board of Directors will select deserving school(s) or student(s).
Yes
 

Electing Pass-Through Entities

Obtaining tax credits through ASF can reduce the federal taxes of S-corps & Partnerships.

Did you know?

S-corps and Partnerships have the option to pay GA income taxes at the entity level instead of each shareholder or member having to pay the taxes individually.

Who Qualifies?

  • S-Corporations
  • Partnerships
  • Multi-member LLCs
high school student studying in library

Frequently Asked Questions

What is HB 149 and how can I take advantage of it?

S-Corps and Partnerships are allowed to file their GA income taxes at the entity level and claim up to 75% of their GA state income tax liability in tax credits through ASF. 

When this option is utilized, the income earned by the business entity will not be passed on to the shareholder(s) as the entity will pay the GA state taxes (like C-corps do).  Since the individual shareholders aren't paying the taxes, the federal SALT cap limitation is negated.


Further, the IRS provides a safe-harbor for S-corps and multi-member LLCs, PCs (and C-Corps as well) to claim state tax credit contributions as an ordinary and necessary business expense deduction on their federal taxes.  Therefore, the entire amount of the state taxes paid (whether directly or in conjunction with tax credits) is deducted and shielded from additional federal taxation.  This can result in huge savings.

The full amount of the tax credit through ASF can be deducted federally as a business expense?

Yes.  In August, 2020, the IRS issued final regulations 2020-17393 making it clear that C-Corps along with specified pass-through entities (S-Corps and Partnerships) can claim state tax credit payments as an ordinary and necessary business expense. Obtaining tax credits through ASF can reduce the federal taxes of S-corps & specified pass-throughs.

I'm the owner of single-member LLC, PC or sole proprietorship, how much can I contribute?

You're allowed to receive a dollar-for-dollar state income tax credit for the amount of their GA state income tax liability, up to a maximum of $25,000. Additionally, the IRS has issued guidance that you can claim state tax credit contributions as an ordinary and necessary business expense deduction on your federal taxes so long as it meets business use requirements.

What meets the Business Use requirements of the IRS?

If the contribution is made with the reasonable expectation of financial return for the business or used "in projects that improve conditions in the state" (like improving educational access & outcomes), then you meet the requirements. The IRS regulations are pretty generous in this regard and it's not a high bar to meet. 

I'm a shareholder in more than one pass-through entity, can I get the full tax credit for each of them?

That depends.  Shareholders are allowed a maximum of $25,000 in tax credits based on income from all pass-through entities combined.

However, if a shareholder is part of an S-Corp or Partnership that utilizes HB 149 to file their GA state income taxes at the entity level, the income from that particular pass-through is not passed on to the shareholder(s) since the entity will pay the GA state tax liability.  In this instance, any taxpayer who is a shareholder in additional pass-through entities, income from those other pass-through entities that have not elected to pay their GA state income taxes at the entity level will be passed on to the shareholder(s) allowing each of them to contribute up to $25,000 for the income earned from those other pass-through entities.

What about my spouse?  They're a shareholder in the pass-through entity too.

Each shareholder is allowed the maximum contribution of $25,000.  So your spouse can contribute $25,000 and you may contribute $25,000 separately.  The paperwork submitted to the Dept. of Revenue is in the name of each individual contributor.

I'm in a partnership with multiple owners.  Can each of us contribute?
Absolutely!  Each shareholder is allowed the maximum contribution of $25,000.  The paperwork submitted to the Department of Revenue is in the name of each individual contributor.
 
However, per HB 149, Partnerships will have the option to pay GA state income taxes as the entity level and claim up to 75% of the GA state tax liability in QEE tax credits through the Alyn Scholarship Fund.  For partnerships that choose this option, the income earned by the partnership will not be passed to the individual partners as the entity will have already paid the GA state taxes owed.
How do I know how much I can actually contribute?

All Georgia income, loss and expense from the taxpayer selected pass-through entity (or entities) will be combined to determine Georgia income for purposes of determining the tuition tax credit. The combined income will then be multiplied by 0.0575 to determine the amount of tax that was paid.  The maximum amount that can be claimed as a tax credit is 5.75% of the Georgia income from pass through entity (or entities).  Amounts above the 5.75% threshold may not be claimed in the current year.

How much Georgia income needs to be generated to be eligible for the full $25,000 tax credit?

A taxpayer’s Georgia income from pass through entities must be at least $434,783 to fully take advantage of the $25,000 tax credit ($434,783 x 0.0575 = $25,000).

Can I reduce my quarterly estimated tax payments by the amount I contribute?

Yes you can. You are allowed to deduct 25% of your contribution amount from each of your quarterly payments. 

Can the tax credit be claimed each quarter?

Any person or business paying quarterly estimated taxes has the option to claim 25% of the contribution amount against each quarterly payment.

Can the tax credit be carried forward? 

While the tax credit is a non-refundable, any portion of the tax credit that is not utilized can be carried forward for up to five years.  However, if the amount of the tax credit claimed is above what the tax liability ended up being, the excess amount cannot be carried forward. 

Can I choose to support more than one school with my contribution?

Absolutely. Just make that notation during the contributions process and designate how you'd like the funds to be divided and we'll honor your wishes.

Request to Contribute

To request to contribute to scholarships for Georgia Students, use the form below.
 

Education Tax Credit Form - Electing Pass-Through Entities

Complete All Fields

 
 
 
 
 
 
 
 
 
 
 

Primary Contact Information

Contribution Information

Designated to a particular school or schools.
Undesignated (The ASF Board of Directors will select deserving school(s) or student(s).
Yes
 

Insurance Companies

Receiving tax credits improves education while benefiting your business.

Did you know?

Georgia's HB 517 creates a "Business Entity" contributor category that is defined as: Any insurance company or the headquarters of any insurance company required to pay the tax provided for in Code Section 33-8-4 (GA Insurance Premium Tax).
 
This same law allows insurance companies to claim 100% dollar-for-dollar tax credits through the Qualified Education Expense program based on their Georgia state insurance premium tax liability.
children at school taking notes

Frequently Asked Questions

I am an insurance company, how much can I contribute?

In 2022, Georgia's HB 517 was signed into law which allows insurance companies to claim 100%, dollar-for-dollar tax credits through the Qualified Education Expense program based on their Georgia state insurance premium tax liability. HB 517 creates a "Business Enterprise" contributor category that is defined as: Any insurance company or the headquarters of any insurance company required to pay the tax provided for in Code Section 33-8-4 (GA Insurance Premium Tax).

How much can a Business Enterprise (Insurance Company) contribute?

Up to 75 percent of the business enterprise's Georgia state insurance premium tax liability. However, individual Business Enterprises are limited to a maximum contribution of $1 million.

Is there an annual cap for Business Enterprises?
Yes. There is an annual cap of $6 million allocated, and it's first come, first serve. Once $6 million in contributions have been made by Business Enterprises, no more contributions can be made in this contributor category until the following year when the fund opens again.
 
Additionally, while $6 million is set aside for Business Enterprises, they are also competing with all other GA taxpayers for these tax credits as well. So, it's imperative that Business Enterprises have their contributions request submitted on the first day that the fund opens to ensure that they will be approved. If they wait to submit their request and the other taxpayer requests exceed $114 million, then the GA Dept of Revenue will allow the other taxpayers to claim those credits that were originally set aside for Business Enterprises. So, basically, it's a use it or lose it process.
Can the tax credit be claimed each quarter?

Any person or business paying quarterly estimated taxes has the option to claim 25% of the contribution amount against each quarterly payment.

Can the tax credit be carried forward?

Yes, any unused portion of the tax credit can be carried forward for up to five years.

Can the tax credit be used for previous years liability?

No, the tax credit can only be carried forward.

Can I designate that my contribution will provide a scholarship for particular students?

No. The law is very clear that you can designate your contribution to benefit a particular private school(s) in Georgia, but that you can not direct it to specific students. 

Can I choose to support more than one school with my contribution?

Absolutely.  Just make that notation during the contribution process and designate how you'd like the funds to be divided and we'll honor your wishes.

Am I required to choose a school(s)?

No. If you'd like to help students no matter which Georgia private school they choose to attend, we have an Undesignated Fund. We utilize this fund to provide scholarship assistance to those eligible students who will not be attending a school that we otherwise have funds available for.

How do I make my contribution?

Please see How to Contribute.

What percentage of a contribution is used for scholarships?

The law requires that a minimum of 92% of contributions be awarded to eligible students as scholarships.

Request to Contribute

To request to contribute to scholarships for Georgia Students, use the form below.
 

Education Tax Credit Form - Insurance Companies

Complete All Fields

 
 
 
 
 
 
 
 
 
 
 

Primary Contact Information

Contribution Information

Designated to a particular school or schools.
Undesignated (The ASF Board of Directors will select deserving school(s) or student(s).
Yes