OHIO SCHOLARSHIP GRANTING ORGANIZATION ( SGO )
Donation Credit : A Win-Win for Taxpayers and Local Schools
Unlock the potential of the Ohio Scholarship Donation Credit to not only contribute to the quality of local private education but also to leverage significant tax advantages . This article is your guide to understanding how making charitable donations can be a win-win : supporting students while optimizing your tax situation . The program offers up to $ 750 in tax credits for individuals and $ 1,500 for married couples filing jointly , potentially neutralizing the cost of your contribution .
What is an SGO ?
An SGO , a specific type of 501c3 organization , collects donations to provide scholarships for K-12 students in private and parochial schools . To be eligible for the credit , ensure your contribution is to a registered SGO . A list of registered SGOs is available on the Ohio Attorney General ’ s website .
This article will navigate you through the eligibility criteria , ensuring you can fully benefit from this opportunity . We ’ ll delve into the mechanics of the Scholarship Donation Credit , illustrate how your donations to qualified Scholarship Granting Organizations ( SGOs ) can enhance your corporate social responsibility profile , and simultaneously provide a tax-efficient strategy for your financial planning . Whether you ’ re a seasoned philanthropist or a business looking to make a meaningful impact , this insight will empower you to make informed decisions that benefit both your company and the community .
The Impact of Your Donation :
Donations to SGOs fund scholarships , offering private and parochial schools an added resource to support education , including the reduction in tuition for students . Some SGOs focus on a single school , while others support multiple institutions .
How the Scholarship Donation Credit Works :
To qualify , contributions must be made directly to an SGO , not the school . After donating , you ’ ll receive a receipt from the SGO , which is essential for claiming the credit on your Ohio tax return . Notably , for tax year 2023 and onwards , contributions can be made up until the unextended due date of your tax return and still be eligible for the credit on your 2023 tax return . This differs from regular 501c3 organizations , where donations must be made within the same tax year to receive the benefit .
Understanding Non-Refundable Credits :
It ’ s important to note that this credit is non-refundable . If your Ohio tax liability is less than the credit amount , the excess is not refunded . Consult a tax advisor to maximize the benefit .
Andrew Geiser
Principal 212 North Washington Street Millersburg , OH 44654 andrew . geiser @ reacpa . com ( 330 ) 674 – 6055
Contributing and Claiming the Credit :
If you ’ re considering a contribution :
• Identify the School and SGO : Contact the school of your choice to learn about their associated SGO . If a school isn ’ t part of an SGO , they must join one to benefit from your donation .
• Verify SGO Registration : Ensure the SGO is registered in Ohio and the registration is active .
• How to Contribute : Schools usually provide details on making contributions to their SGO . If not , contact the SGO directly .
• Consult a Tax Advisor : Before contributing , confirm that you can fully use the credit .
• Make the Contribution : Do this before filing your 2023 tax return . Married couples seeking the maximum $ 1,500 credit should make separate contributions of $ 750 each .
• Keep the Receipt : Obtain a receipt for each contribution for tax filing purposes .
The Ohio Scholarship Donation Credit is more than just a tax benefit ; it ’ s an investment in the future of education . By contributing , you ’ re directly affecting local schools and students while potentially reducing your tax liability . As always , consult with your tax advisor to ensure you make the most of this opportunity .