Friends Select is an approved Scholarship Organization and has already received support through the EITC Program. The Commonwealth of Pennsylvania has allocated millions of dollars in tax credits to the EITC program for 2012-2013. Funds are disbursed on a first-come-first-served basis. The deadline for applications is June 30, 2012.  Now is the time to fill out the simple one page application so your business doesn't miss out on this great opportunity.

How does it work?  Businesses participating in the EITC program can achieve tax savings in two ways:

1. Credit against Pennsylvania state taxes – the tax deduction is dollar-for-dollar against tax due.
2. Deduction against net income as a charitable donation.

How is that possible?  The dollars the business would have paid to the state in taxes will instead be diverted to Friends Select in satisfaction of up to $300,000 of the company’s Pennsylvania tax liability.

See the FAQs below for how to help our school access this great source of “free” money! For more information contact Rebecca Rankin, Director of Annual Giving, rebeccar@friends-select.org or 215-561-5900 ex 131.

What is the Educational Improvement Tax Credit (EITC) Program?
The EITC Program enables companies to support nonprofit schools at minimal cost. Instead of sending tax dollars to Harrisburg, companies can reallocate them to support Friends Select’s financial aid program.

Who may make EITC gifts?
You might be surprised.  Businesses ranging from neighborhood pharmacies, to mid-sized companies, to large corporations all are eligible.  This includes the following type of businesses.
• C-Corporations (taxed at the corporate level)
• S-Corporations
• Partnerships
• Sole Proprietors
• Limited Liability Companies (LLC’s)
• And new this year, subchapter S corporations and other business entities that pay their State business taxes under the personal income tax on PA business income can now fully participate. 

Here are the business taxes you can claim credits against:
• Corporate net income tax
• Capital stock/franchise tax
• Bank and trust company shares tax
• Title insurance companies shares tax
• Insurance premiums tax
• Mutual thrift institutions tax

How much of a business’ tax liability can be donated to Friends Select through EITC?
Businesses can receive a tax credit equal to 75% of a contribution up to $300,000 per taxable year. The tax credit increases to 90% if the business agrees to provide the same amount for two consecutive years. A charitable contribution deduction may be available to a business for the remaining contribution amount not eligible for a tax credit – making the total for cost ZERO.

Where do I get an application?
The simple, one page application form is available through the Department of Community and Economic Development at (717) 787-7120 or at www.newpa.com.   Select “EITC Business Guidelines” for further information and the application form.  The process is very simple:

1. Business completes one page application and submits it to the Department of Community and Economic Development (DCED).
2. Business receives a letter of approval from DCED.
3. Business submits monetary contribution within 60 days to Friends Select School.
4. Friends Select provides business with acknowledgment of contribution.
5. Business submits acknowledgment to DCED.
6. DCED communicates with PA Dept. of Revenue and applicable tax credit is applied to business tax account.
7. Credit is taken as a payment of taxes on businesses’ annual tax return filing.

When do I submit the application?
For next year, the application should be submitted on July 1, 2012, because the money is disbursed on a first-come-first-served basis. Friends Select School is happy to forward your application to the state.

Can Friends Select help me apply?
Yes. We will work with you – even complete the application for your signature, and deliver it for you. We want to make the process as simple as possible.

Who should I contact at Friends Select to learn more or to discuss my interest in making an EITC gift?