How Your PA State Tax Dollars Can Support Financial Aid

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Anyone paying at least $3,500 in PA state taxes can reallocate 100% of these tax dollars to support financial aid for Friends Select students. The Central Pennsylvania Scholarship Fund currently has approved tax credits from Special Purpose Entities (SPEs), which are available to qualified individuals and businesses. To take advantage of this opportunity, you should claim these tax credits as soon as possible!

The Process

  1. Contact your tax specialist and Christine Jefferson, Friends Select director of development and alumni/ae relations (chrisj@friends-select.org or 215.561.5900, ext. 3141).
  2. Sign a joinder as soon as possible to reserve your tax credits. Indicate your contribution amount, and that you would like these tax credits to support “Friends Select School.”
  3. Send a check in December in the amount of your contribution to the SPE, which will forward the funds to Friends Select’s financial aid program.
  4. Check your mail for a thank-you letter in January, followed by a K-1 form (PA 1123) for a tax credit that should be filed with your taxes.
  5. Receive a credit of 90% of your contribution after filing your PA state taxes, and claim the other 10% as a charitable contribution when filing your federal taxes.

The chart below is an example of how these tax credits can help both you and Friends Select School:

PA State Taxes of Donor

$ 10,000

SPE Contribution

$ 10,000

90% PA State Tax Credit 90%

$ 9,000

Fed. Charitable Deduction 10%

$ 1,000

Total Tax Savings

$ 9,000

For more information about the Central Pennsylvania Scholarship Fund, contact Jeff Wilson (jeffwilsonsales@gmail.com or 814.283.4338).

Upcoming Events

Join Jeff Wilson from the Central Pennsylvania Scholarship Fund and Christine Jefferson, director of development and alumni/ae relations, to learn more about this exciting opportunity at an informational coffee at Friends Select School. RSVP for these events here.

Webinars
Thursday, November 15, 12:00 - 12:45 p.m.

Coffee in the Seminar Room
Wednesday, December 5, 8:15 - 9:00 a.m.

FAQs

Is there an upfront cost?

Yes, you must submit a check in December for a minimum of $3,500 to the SPE for Friends Select School: the Central Pennsylvania Scholarship Fund. After you file your taxes using the K-1 form (PA 1123) that will be provided, you will receive a credit for 90% of your contribution.

What are Special Purpose Entities (SPEs)?

Special Purpose Entities (SPEs) are used in Pennsylvania to aggregate contributions from individuals interested in the Education Improvement Tax Credit (EITC) or Opportunity Scholarship Tax Credit (OSTC) programs. While EITC and OSTC were open only to corporate donors, organizations like the Central Pennsylvania Scholarship Fund make it possible for individuals to contribute.

Who is this program available to?

This program is available to individuals and businesses alike. As long as you pay a minimum of $3,500 in PA state taxes, you can qualify.

Will my entire contribution directly support financial aid at Friends Select?

Yes, all you have to do is indicate in your joinder that you would like your contribution to go to “Friends Select School.”

Should I fill out the joinder in full, even if I am uncertain about the amount that I will be paying in PA state taxes?

Yes, by filling out the joinder, you are essentially reserving your tax credits. It is possible to adjust the amount listed on your joinder before the end of the calendar year. For assistance, contact Christine Jefferson (chrisj@friends-select.org or 215.561.5900, extension 3141).

Can I adjust the amount listed on my joinder once a new calendar year begins?

We hope that individuals will make a two-year commitment to support financial aid at Friends Select through contributions to the Central Pennsylvania Scholarship Fund. You will be reminded to reapply after January 1 and fill out a new joinder for the year ahead, at which point you can adjust the amount listed.

Is the other 10% of my contribution tax deductible?

Yes, the other 10% of your contribution qualifies as a federal charitable donation, if you itemize your deductions at tax time. Contact your tax specialist or Jeff Wilson at the Central Pennsylvania Scholarship Fund (jeffwilsonsales@gmail.com or 814.283.4338) for more information.