Qualified Donors Receive a 65% Virginia Tax Credit

 
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Students from low and middle income families, who would otherwise not have access to private school education, now have this opportunity.  Supporters of these students through the GRASP Education Improvement Scholarship Program (EISP) make this possible for children in need and donors also realize a significant tax savings as a result.  GRASP EISP is a program of the GReat Aspirations Scholarship Program, Inc., a 501(c)3 non-profit organization founded in 1983.

GRASP EISP provides scholarships for students from families of limited resources to attend private schools which may better suit their needs.  Individuals and businesses who contribute to GRASP EISP, and who pay taxes in the Commonwealth of Virginia, are eligible to receive a 65% state tax credit as part of the Virginia Education Improvement Scholarship Tax Credit program.  The 65% tax credit is in addition to current state and federal tax deductions for charitable donations.

 
 

Individuals and businesses can achieve tax savings two ways:

  1. For the year of the donation, they may take a deduction against their net income as a charitable donation on both their federal and state income taxes. The tax reduction equals the contribution amount times the tax rate of the applicable tax (federal or state). Subject to rules governing deductibility of charitable contributions.
  2. For the year of the donation, they may also take a credit against Virginia taxes. Tax reduction equals 65 percent of the amount of the donation.

Limitations

  • For individuals, the minimum value of any monetary or marketable securities donation eligible for a tax credit is $500 in a taxable year, and the maximum value of monetary or marketable securities donations eligible for tax credits is the first $125,000 in value of donations made in a taxable year.
  • These limitations on the minimum and maximum values of donations eligible for tax credits in a taxable year do not apply to donations made by any business entity, including a sole proprietorship.

Details and Additional Benefits:

  • Credit is non-transferable.
  • Credit may not exceed the tax liability but may be carried over for five succeeding years.
  • Businesses can claim the credit against:  Corporate Income Taxes, Virginia Bank Franchise Tax, Virginia Insurance Premiums License Tax , Virginia Public Service Corporations Tax, Personal Income Taxes via pass-through from S-Corporations.
  • Individuals can claim the credit against Personal Income Taxes.

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