EITC Tax Credits

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The Educational Improvement Tax Credit (EITC) program is an incredible opportunity for individuals and businesses in Pennsylvania to redirect a portion of their state taxes to support tuition assistance at Saints Neumann Goretti High School. Through this program, you can make a significant impact on the lives of our students, while also receiving substantial tax benefits.

It’s easy to apply; more information is available by emailing Nikki Kane, Director of Institutional Advancement at nikki.kane@neumanngorettihs.org.

 

How to Become a Donor: SIMPLE!

  1. Check Your Tax Return:
    Look at PA-40, line 12 from your most recent Pennsylvania tax return to see what your PA tax liability was last year. If it’s $1,000 or more, you’re eligible!
  2. Decide Your Contribution:
    Let us know how much you would like to contribute. The minimum donation is $1,000.
  3. We’ll Connect You with a Scholarship Organization:
    We will connect you with one of our partner scholarship organizations such as BLOCS or The Foundation for Catholic Education.
  4. Approval & Special Purpose Entity:
    After your donation is approved, you’ll be assigned a Special Purpose Entity (SPE) and will write your check directly to that entity.
  5. Receive Your K-1 Form:
    In February, the scholarship organization will send you a K-1 form, which you’ll use when filing your taxes.
  6. See the Impact:
    Your out-of-pocket cost will be a fraction of the donation, but Saints Neumann Goretti will receive 100% of your contribution, making a huge impact on our students.
  7. Consult with a Tax Advisor:
    Be sure to consult with your tax advisor to understand the full tax benefits and deductibility of your gift.
 

How It Works for Individuals:

 

If you owe Pennsylvania state taxes and your tax liability is over $1,000, you are eligible to participate in the EITC program. By making a donation to Saints Neumann Goretti, you will receive a tax credit on your PA taxes, and your donation will directly support students in need of financial assistance.

  1. Eligibility
    Check PA-40, line 12 from your most recent Pennsylvania tax return to determine your tax liability. If it is $1,000 or more, you are eligible to participate.
  2. Donation Commitment
    You can choose to make a one-year or two-year commitment.
    • For a one-year commitment, you will receive a 75% tax credit.
    • For a two-year commitment, you will receive a 90% tax credit for each year.
  3. Tax Credit Benefit
    Your donation will provide you with a PA tax credit. For example, if you donate $10,000, and make a two-year commitment, you will receive a $9,000 tax credit. You may also receive a federal tax reduction depending on your tax situation.
  4. K-1 Form for Tax Filing
    After making your donation, the scholarship organization will send you a K-1 form that you can use when filing your taxes. This will allow you to receive either a refund or a credit, depending on your tax situation.
  5. Out-of-Pocket Cost
    Because of the tax credit and federal tax reduction, your out-of-pocket cost will be significantly lower than the amount you donate, allowing you to contribute more while spending less.

 

Sample Donation Scenario

 

-Donation to Saints Neumann Goretti High School: $10,000

-PA Tax Credit (90% for 2-Year Pledge): $9,000

-Net Federal Tax Reduction (based on 37% tax rate): $370

-Out-of-Pocket Cost: $630

 

This means your $10,000 donation only costs you $630 out-of-pocket after the tax credits and federal deductions. Your gift will have 10x the impact as Saints Neumann Goretti receives 100% of your donation.

 

How It Works for Businesses:

 

The EITC program also offers a valuable opportunity for businesses in Pennsylvania to support Saints Neumann Goretti High School while receiving tax credits. By redirecting a portion of your PA state taxes, your business can provide much-needed tuition assistance for our students and receive significant tax credits.

  1. Eligibility for Businesses
    If your business owes Pennsylvania state taxes, you are eligible to participate. Neighborhood businesses, mid-sized companies, and large corporations can all take advantage of the program.
  2. Tax Credit Benefits for Businesses
    • One-Year Commitment: Businesses receive a 75% tax credit on their donation.
    • Two-Year Commitment: Businesses receive a 90% tax credit on their donation for each year.
  3. Donation Process for Businesses
    • Your business makes a donation through an approved scholarship organization such as BLOCS or The Foundation for Catholic Education.
    • Once approved, your business will be assigned to a Special Purpose Entity (SPE), to which the donation is made.
    • Saints Neumann Goretti receives 100% of the donation, and your business receives the tax credit.

Example For Business

 

-Business Tax Liability: $25,000

-Donation Amount: $33,334 (to receive the full tax credit of $25,000)

-Tax Credit (75% for 1-Year Commitment): $25,000

-Donation Cost to Business: $8,334 (after tax credit)

 

If your business commits to a two-year donation, you can receive a 90% tax credit each year, reducing the business’s out-of-pocket cost even further.

 

Get Involved Today!

To learn more about the EITC program or to make your donation, please contact Nikki Kane, Director of Institutional Advancement, at nikki.kane@neumanngorettihs.org or (215-459-6271. We’re here to help guide you through the process and ensure your donation supports our students in the best way possible.