If the credit a tax payer receives for a donation exceeds the liability, the credit can be carried forward for up to 5 years.
Can donations be directed to a school that is not recognized by the Illinois State Board of Education (ISBE)?
Donations can be directed to schools that are recognized or in the process of being recognized by ISBE. However, only schools recognized by ISBE are eligible to receive donations to be used for scholarships under the Invest in Kids Act. Schools in the process of being recognized by ISBE are marked with “PENDING RECOGNITION” on the Empower Illinois website. If a school marked with “PENDING RECOGNITION” is not recognized by the earlier of (1) August 1st, 2018 or (2) a date specified by the state of Illinois, donations directed to any such school will be recharacterized as undesignated donations for the same region in which the school marked with “PENDING RECOGNITION” is located and made available to eligible students on a first come, first served basis. There can be no guarantees as to whether a school marked with “PENDING RECOGNITION” will be recognized by ISBE in the future and be eligible to receive scholarship money under the program.
Can one donate marketable securities such as stocks and bonds, and is there any advantage in doing so?
Both Big Shoulders Fund and Empower Illinois accept marketable securities as STC donations. The securities are converted by the SGO into cash. If the liquidated value does not cover the amount of the tax credit reservation, donors can make up the difference by making an additional payment. If the liquidated value exceeds the amount of the tax credit reservation, the difference would be used by the SGO as an unrestricted donation. As such, one should make a reservation that exceeds the anticipated liquidated value.
The benefit to the donor is the ability to avoid paying taxes for capital gains.
For additional information on how to donate marketable securities, please contact the Agudah at firstname.lastname@example.org, the SGO you intend to donate to or the school for which you intend to designate your contribution.
There are 5 regions.
When reserving your tax credit on the Illinois Department of Revenue website, it is important that you choose the region in which your designee(s) are located, not the region of your home address. All schools in our network are in Region 1 (Cook County), with the exception of TABG, which is in Region 2.
If your designees are in different regions, you must make separate reservations for each region in the amounts for each donation you seek to make.
If you’re out of state, but pay taxes in Illinois, you can still donate and receive a tax credit. You will need a My Tax account. Please click here for instructions: https://agudahstc.org/donate/
Yes, all donations can be anonymous.
Can donation credits be applied against Illinois’ personal property replacement tax that corporations (including Subchapter S corporations), partnerships and trusts are subject to?
No. The tax credit scholarship statute and regulations prohibit this.
Yes, credit cards are an accepted form of payment for both Big Shoulders Fund and Empower Illinois. Big Shoulders, however, does not charge transaction fee, while Empower Illinois does charge a 3.25% processing fee.
You may contact Agudah directly at email@example.com or call our helpline at (773) 279-8400 ext 260. In addition, you may contact the SGO you intend to donate through, or the school you intend to designate.
Can a taxpayer make a tax-credited contribution to a Scholarship Granting Organization from a donor advised fund?
No. A donor advised fund is a charitable giving vehicle administered by a public charity created to manage charitable donations on behalf of organizations or individuals. Payments to Scholarship Granting Organizations are not treated as charitable contributions for federal income tax purposes and therefore payments from a donor advised fund do not qualify for the tax credit. The payment of tax-credited scholarship donations to a Scholarship Granting Organization must come directly from the individual or corporate taxpayer.
How is the amount of a scholarship determined? What is the maximum scholarship a student can receive?
In order to qualify for a scholarship, a student’s family will have to provide official documentation of their household income.
• For students whose household income is less than 185% the Federal Poverty Level, the scholarship will be 100% of tuition and necessary fees, or equal to the statewide average operating expense per pupil, whichever is lower;
• For students whose household income is between 185% of and 250%, scholarships will be 75% of tuition and necessary fees or 75% of the statewide average operating expense per pupil, whichever is lower; and
• For students whose household income is between 250% and 300%, scholarships will be 50% of tuition and necessary fees or 50% of the statewide average operating expense per pupil, whichever is lower.
The maximum scholarship equals tuition and necessary fees or the statewide average operating expense per student, whichever is lower.
• For the 2021-2022 school year, the statewide average operating cost per pupil is $14,492.
• Students identified as gifted and talented can receive up to 1.1x the maximum scholarship, not to exceed the cost of full tuition and necessary fees.
• Students identified as English Language Learners can receive up to 1.2x the maximum scholarship, not to exceed the cost of full tuition and necessary fees.
• Students identified as eligible to receive services under the federal Individuals with Disabilities Education Act can receive up to 2x the maximum scholarship, not to exceed the cost of full tuition and necessary fees.
K-12 students from families with limited financial resources, up to 300 percent of the federal poverty level (or up to 400% for students that received a scholarship in a prior year), are eligible to receive a Tax Credit Scholarship. From January to April, priority will be given to students from each of the following categories:
• Students who are members of a household whose previous year’s total annual income does not exceed 185% of the federal poverty level; and
• Students who reside within a focus district (e.g. residents of the city of Chicago); and
• Students who received a scholarship in a prior year.
After April 1, all other qualifying students will be considered for scholarships.
No priority status is accorded to students who apply after April 1st.
Individuals may direct donations to a particular school or subset of schools (e.g. Agudah schools), but NOT to an individual student or group of students. Corporate donors cannot restrict their donations.
Individuals will direct their donations to the school or schools of their choice when they make a donation to the SGO after they have reserved their credit. However, when reserving a tax credit with the IL Department of Revenue, donors will need to select the region in which their designated school or schools are located in.
The donation process is much simpler than it initially appears to be. For a step-by-step guide, click here: https://agudahstc.org/donate/
A Scholarship Granting Organization (SGO) is an independent 501(c)(3) non-profit organization whose primary aim is to give scholarships to students. Among SGO responsibilities are:
• Receiving donations from individuals and corporations;
• Receiving and processing scholarship applications from students/families; and
• Distributing scholarships to eligible students/families in accordance with the law.
• Determining whether students meet the income eligibility requirements to receive a scholarship and must distribute scholarships to eligible students on a first-come, first-served basis. SGOs must honor restrictions placed on donations from individuals, if any.
Yes. The program is capped at $75 million in state tax credits per year. This means that in order for the $75 million cap to be hit, $100 million will have to be donated. A maximum of $100 million in scholarships will be awarded through this program annually to students throughout Illinois.
An individual or corporate donor will receive a 75% credit on their donation. This means that if a donor contributes $10,000, they will receive a state tax credit of $7,500. Donations by both individual and corporate donors are capped at $1.33 million, i.e. a per-donor tax credit of $1 million.