Don’t Miss this Tax Credit!

Thanks to a state law passed in 2021, Ohio taxpayers are now eligible to receive a tax credit for qualified donations to a certified scholarship granting organization (SGO).

Donors receive a dollar-for-dollar credit (not deduction) on their Ohio income tax liability of up to $750 or $1,500 if married, filing jointly.

HOW THE TAX CREDIT WORKS:

This dollar-for-dollar state tax credit is applied toward your current year taxes. In other words, you will receive a 100% tax credit for your contribution when you file your taxes in the next calendar year. Here are some important items to know:

  1. The tax credit is limited to the total Ohio state income tax due that can be found on your state income tax return (Ohio IT1040). You may contribute more than $750, but the credit is capped at $750 per taxpayer. Your gift may also be eligible for a full tax deduction on your federal tax return.
  2. If the total tax due exceeds $750 (single) or $1500 (married), then you are eligible to contribute up to the maximum ($750) and receive the total tax credit.
  3. If the total tax due is less than $750, then your tax credit is limited to the amount of tax on your Ohio IT 1040.
  4. Married couples can receive up to two separate $750 deductions, totaling $1500, however they must make TWO SEPARATE $750 donations, one in each of their names. A single $1500 will only return a single $750 tax credit.
  5. The deadline to contribute for the 2023 tax year is April 15, 2024. Donations received after April15 will be for the 2025 tax year.
  6. Please note that a new tax year begins January 1. Donations in 2025 will count towards the 2025 Tax Year unless specified otherwise.
  7. Be sure to bring your donation receipt to Patriot Tax with your other tax documents.

Patriot Tax has discussed this tax credit opportunity with the Ohio Christian Education Network & they have been kind enough to share the attached video to help further explain the tax credits to our clients.

Learn more about the tax credit and the Ohio Christian Education Network.