The Invest in Kids Act
The Invest in Kids Act, which was signed into law in 2017, provides up to $100,000,000 in private school K-12 scholarships to children from low-income and working-class families. Scholarships are funded through contributions from individuals and corporations to scholarship granting organizations.
How It Works
How Your Taxes Are Affected
Scholarship Tax Credit Educational Seminar
Examples
1. An individual with a taxable income of over $20 million has a liability of $1 million
a. The individual contributes $1,333,333 and will not pay any state income tax (or will receive a $1,000,000 refund).
b. The individual contributes $1 million will only pay $250,000 in state income tax (or will receive a $250,000 refund).
2. An individual with a taxable income of $55,000 has a withholding of $2,725 and a liability of $2,172. He would receive a refund of $553 without contributing. He also contributes $350 annually to charity.
a. If the individual contributes $2,000, he will receive an additional $1,500 for a total refund of $2,053, which exceeds his donation by $53.
b. If the individual stops his employer from withholding $2,725 and contributes $2,896, he will pay nothing in state income tax. This $2,896 contribution will cost him $14 a month.
c. If the individual wishes to simply shift tax dollars to charity without increasing his out-of-pocket costs, he contributes $1,310. That reduces his taxes by $982 to $1,190. His total out-of-pocket is $2,500 which is $22 less than it would otherwise be ($2,172 in taxes + $350 in charity = $2,522), and he has shifted nearly $1,000 from taxes to scholarships for low-income children.
Important
