Who is eligible for a credit for donations to this program? Businesses and individuals that have filed a Louisiana income tax return in the year for which they make a donation are eligible.
Can donors/community partners designate their donation for a specific student or group of students? Community partners may not designate their donation for a specific student unless their donation benefits a student(s) with disabilities. Taxpayers may designate their donations for all students with disabilities, students with a specific type of disability, or a specific student with a disability.
Can community partners designate their donation for a specific school or group of schools? While community partners may not designate their donation for a specific school, they may coordinate with Aspiring Scholars to potentially designate their donation for a particular group of schools.
How much of a TDC donation is eligible for a credit? Taxpayers receive credit for the portion of their donation that Aspiring Scholars uses to fund student scholarships at the end of each school year. The credit is a nonrefundable credit which can be used to offset income tax and any unused credit amount may be carried forward as a credit against subsequent income tax liabilities for a period not to exceed three taxable years.
How much of the donation can be used for administrative costs? By law, up to 5% of donations for student scholarships may be used for administrative costs. Community partners may choose to designate 100% of their donation for administrative costs instead of student scholarships, but this donation would then not be eligible for a credit.
How does a donor/community partner receive the credit? The Louisiana Department of Education will verify the amount of each taxpayer’s donation spent on student scholarships and issue a receipt to the taxpayer through Aspiring Scholars. The taxpayer must attach the receipt when filing their income tax return. If the donation was made by an individual or a business owned by a sole proprietor or a flow-through entity such as a Limited Liability Company (LLC), Partnership, Subchapter S corporation, the credit will be claimed on the Resident Individual Income Tax return, Form IT-540, or the Nonresident and Part-Year Resident Individual Income Tax Return, Form IT-540B. If the business making the donation is a corporation or C-corporation, the credit will be claimed on the Corporation Income and Franchise Tax Return, Form CIFT-620.
Who should donors/community partners contact regarding specific tax liability questions? Specific questions regarding how donations and potential credit impacts tax liability should be referred to a tax lawyer or advisor.
How can I promote Aspiring Scholars to my friends, family, and community? The best way we can increase scholarships for students attending Louisiana Catholic schools is to increase the number of Louisiana taxpayers who direct their tax liabilities to Aspiring Scholars. Thank you for sharing in our mission! You can find resources for schools and partners here. If you have questions, please reach out to in[email protected].