Sec. 6002. Tax credits for contributions to eligible scholarship-granting organizations
1,388 words·~6 min read·
/bill/116/s/4775/pcs/section-6002·A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
Subpart A of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding after section 25D the following new section: Subject to section 6003(c) of the Delivering Immediate Relief to America’s Families, Schools and Small Businesses Act , in the case of an individual, there shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to the sum of any qualified contributions made by the taxpayer during the taxable year. The credit allowed under subsection
(a)for any taxable year shall not exceed 10 percent of the taxpayer’s adjusted gross income for the taxable year. For purposes of this section— The term eligible scholarship-granting organization means— an organization that— is described in section 501(c)(3) and exempt from taxation under section 501(a), provides qualifying scholarships to individual elementary and secondary students who— reside in the State in which the eligible scholarship-granting organization is recognized, or in the case of the Bureau of Indian Education, are members of a federally recognized tribe, a State identifies to the Secretary as an eligible scholarship-granting organization under section 6003(c)(5)(B) of the Delivering Immediate Relief to America’s Families, Schools and Small Businesses Act , allocates at least 90 percent of qualified contributions to qualifying scholarships on an annual basis, and provides qualifying scholarships to— more than 1 eligible student, more than 1 eligible family, and different eligible students attending more than 1 education provider, or an organization that— is described in section 501(c)(3) and exempt from taxation under section 501(a), and pursuant to State law, was able, as of January 1, 2021, to receive contributions that are eligible for a State tax credit if such contributions are used by the organization to provide scholarships to individual elementary and secondary students, including scholarships for attending private schools. The term qualified contribution means a contribution of cash to any eligible scholarship-granting organization. The term qualified expense means any educational expense that is— for an individual student’s elementary or secondary education, as recognized by the State, or for the secondary education component of an individual elementary or secondary student’s career and technical education, as defined by section 3(5) of the Carl D. Perkins Career and Technical Education Act of 2006 ( 20 U.S.C. 2302(5) ). The term qualifying scholarship means a scholarship granted by an eligible scholarship-granting organization to an individual elementary or secondary student for a qualified expense. The term State means each of the 50 States, the District of Columbia, the Commonwealth of Puerto Rico, the outlying areas (as defined in section 1121(c) of the Elementary and Secondary Education Act of 1965 ( 20 U.S.C. 6331(c) ), and the Department of the Interior (acting through the Bureau of Indian Education). A qualifying scholarship awarded to a student from the proceeds of a qualified contribution under this section shall not be considered assistance to the school or other educational provider that enrolls, or provides educational services to, the student or the student's parents. Gross income shall not include any amount received by an individual as a qualifying scholarship and such amount shall not be taken into account as income or resources for purposes of determining the eligibility of such individual or any other individual for benefits or assistance, or the amount or extent of such benefits or assistance, under any Federal program or under any State or local program financed in whole or in part with Federal funds. Nothing in this section shall be construed to permit, allow, encourage, or authorize any Federal control over any aspect of any private, religious, or home education provider, whether or not a home education provider is treated as a private school or home school under State law. This section shall not be construed to exclude private, religious, or home education providers from participation in programs or services under this section. Nothing in this section shall be construed to permit, allow, encourage, or authorize an entity submitting a list of eligible scholarship-granting organizations on behalf of a State pursuant to section 6003(c)(5) of the Delivering Immediate Relief to America’s Families, Schools and Small Businesses Act to mandate, direct, or control any aspect of a private or home education provider, regardless of whether or not a home education provider is treated as a private school under State law. No participating State or entity acting on behalf of a State pursuant to section 6003(c)(5) of the Delivering Immediate Relief to America’s Families, Schools and Small Businesses Act shall exclude, discriminate against, or otherwise disadvantage any education provider with respect to programs or services under this section based in whole or in part on the provider’s religious character or affiliation, including religiously-based or mission-based policies or practices. No participating State or entity acting on behalf of a State pursuant to section 6003(c)(5) of the Delivering Immediate Relief to America’s Families, Schools and Small Businesses Act shall disfavor or discourage the use of qualifying scholarships for the purchase of elementary and secondary education services, including those services provided by private or nonprofit entities, such as faith-based providers. Nothing in this section shall be construed to modify a State or local government’s authority and responsibility to fund education. The Secretary shall prescribe such regulations or other guidance to ensure that the sum of the tax benefits provided by Federal, State, or local law for a qualified contribution receiving a Federal tax credit in any taxable year does not exceed the sum of the qualified contributions made by the taxpayer for the taxable year. If a tax credit allowed under this section is not fully used within the applicable taxable year because of insufficient tax liability on the part of the taxpayer, the unused amount may be carried forward for a period not to exceed 5 years. This section shall apply to a taxpayer for a taxable year only if the taxpayer elects to have this section apply for such taxable year. For purposes of calculating the alternative minimum tax under section 55, a taxpayer may use any credit received for a qualified contribution under this section. This section shall not apply to any contributions made in taxable years beginning after December 31, 2022. . The table of sections for subpart A of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after the item relating to section 25D the following new item: Sec. 25E. Contributions to eligible scholarship-granting organizations. . Subpart D of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section: Subject to section 6003(c) of the Delivering Immediate Relief to America’s Families, Schools and Small Businesses Act , for purposes of section 38, in the case of a domestic corporation, there shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to the sum of any qualified contributions (as defined in section 25E(c)(2)) made by such corporation during the taxable year. The credit allowed under subsection
(a)for any taxable year shall not exceed 5 percent of the taxable income (as defined in section 170(b)(2)(D)) of the domestic corporation for such taxable year. For purposes of this section, any qualified contributions made by a domestic corporation shall be subject to the provisions of section 25E (including subsection
(d)of such section), to the extent applicable. This section shall apply to a taxpayer for a taxable year only if the taxpayer elects to have this section apply for such taxable year. This section shall not apply to any contributions made in taxable years beginning after December 31, 2022. . Section 38(b) is amended— by striking plus at the end of paragraph (32); by striking the period at the end of paragraph
(33)and inserting , plus ; and by adding at the end the following new paragraph: the credit for qualified contributions determined under section 45U(a). . The table of sections for subpart D of part IV of subchapter A of chapter 1 is amended by adding at the end the following new item: Sec. 45U. Contributions to eligible scholarship-granting organizations. . The amendments made by this section shall apply to taxable years beginning after December 31, 2020.
Connectionstraces to 2
Traces to 2 documents
Citation graph
cites case law
Sec. 6002
Tax credits for contributions to eligible scholarship-granting organizations
Cites 2Cited by 0 across 0 sources