Educational Improvement Tax Credits (EITC)

CATRA is an approved EITC organization

The Pennsylvania EITC program allows eligible businesses to receive tax credits for their charitable donations to approved organizations.


WHAT ARE EDUCATIONAL TAX CREDITS?

Enacted by the Pennsylvania Legislature in 2001, the Educational Improvement Tax Credit (EITC) program authorizes tax credits for businesses that make contributions to educational improvement programs such as CATRA.

EITC is administered by Pennsylvania’s Department of Community and Economic Development (DCED).

This program is unique to Pennsylvania. It allows businesses to make charitable contributions and receive tax credits toward their state taxes. Businesses which make a 1 (one) year commitment receive a tax credit equal to 75% of its contribution. Businesses which elect for a 2 (two) year commitment, receive a tax credit equal to a full 90% of their contribution.

Businesses may contribute up to $750,000 and receive tax credit toward Pennsylvania taxes.

WHAT BUSINESSES QUALIFY?

Limited Liability Corporations, C Corporations, S Corporations, and Partnerships authorized to do business in Pennsylvania which are subject to one or more of the following taxes:

  • Personal Income Tax
  • Capital Stock/Foreign Franchise Tax
  • Corporate Net Income Tax
  • Bank Shares Tax
  • Title Insurance & Trust Company Shares Tax
  • Mutual Thrift Tax
  • Malt Beverage Tax or Retaliatory Fees under section 212 of the Insurance Company Law of 1921
  • Insurance Premium Tax (excluding surplus lines, unauthorized, domestic/foreign marine)

HOW MUCH OF A TAX CREDIT CAN I GET FOR MY BUSINESS?

If a company provides a written two-year commitment to equal annual funding, the tax credit is a full 90% of their donation. Companies choosing a one-year commitment will receive a tax credit equal to 75% of their donation. Companies may contribute up to $750,000.

Additionally, the contribution also qualifies as a charitable deduction for federal and state corporate income taxes.

WHAT ORGANIZATIONS CAN BUSINESSES CONTRIBUTE TO IN ORDER TO RECEIVE THE CREDIT?

Organizations eligible to receive EITC contributions must be a recognized 501(c)(3) non-profit organization and be approved by the Department of Community and Economic Development.

Confirmation of CATRA’s approval as an EITC organization can be found on the DCED website at www.newpa.com/eitc.

HOW DOES CATRA UTILIZE EITC CREDITS?

CATRA supports students in its Job Training and Civic Engagement Program. This program is available to school districts from the capital region of Pennsylvania. Through this program, CATRA strengthens Intermediate Units and Special Needs classroom opportunities in student job coaching and assessment. CATRA provides supervised,  on-site, hands-on assistance allowing teachers, coaches, and aides to give their students the experience of a “typical” work environment.

WHAT IS THE PROCESS TO RECEIVE THE TAX CREDIT?

Although there is over $75 million dollars available, business interest is extreme. New applicants must apply on July 1 using the Single Application for Assistance found at www.newpa.com/eitc.   Feel free to contact CATRA and we will be happy to show you the process. The application must be submitted online and typically takes less than 20 minutes.