The Qualified Education Expense Credit program (a.k.a. Private School Tax Credit / SSO Tax Credit, etc) was passed into law in 2008 through a piece of legislation named HB 1133. In 2011, an expansion bill called HB 325 was passed into law. In 2013, a new bill called HB 283, which redefined the tax credit cap and added a $10k max for pass-through taxpayers, was passed.
Although several changes are apparent from one bill to the next, the bills as a whole are centered around providing tax credits to GA tax payers who wish to support educational opportunities to families seeking educational alternatives to the free Public School option.
The Georgia Legislature originally set aside approximately $50 million in tax credits annually to provide these options. Georgia tax payers can make a private donation to a State registered SSO and receive a dollar-for-dollar GA tax credit, as well a Federal charitable contribution deduction. The law also allows for tax credit donors to express their wish of which school should receive the opportunity to access the tax credit contribution monies for tuition scholarships through their chosen SSO.
These are some of the highlights of the current law:
- $58,000,000 maximum allocated each year
- Credits allocated on a first-come, first-served basis.
- Pass through taxpayers can redirect up to $10,000 each
- Within 60 days of the pre-approval notice from the DOR, donors must make their contributions to an SSO.
- Donations to an SSO only count in the same calendar year in which the donation was pre-approved and paid.
- Taxpayers must add back to Georgia taxable income that part of any federal charitable contribution deduction taken on a federal return for which Georgia Qualified Education Expense Credit is allowed.