Turn part of the state tax you already owe into a scholarship.
Pennsylvania lets businesses and taxpayers send part of their state tax to scholarships instead of Harrisburg. The state gives back 75% to 90% of the gift as a tax credit.
EITC stands for Educational Improvement Tax Credit. It's a Pennsylvania program that lets you give to a scholarship fund and get most of that gift back as a credit on your PA taxes.
Instead of paying all of your state tax to Pennsylvania, you send part of it to scholarships. The state then lowers your PA tax bill by 75% of your gift, or by 90% if you give the same amount two years in a row.
Acton isn't a state-approved scholarship organization itself, so gifts go through BLOCS, a statewide scholarship organization approved by the PA Department of Community and Economic Development (DCED). You ask BLOCS to direct your gift to Acton Academy Pittsburgh.
A sister program, the Opportunity Scholarship Tax Credit (OSTC), works the same way for students who live in the attendance area of a low-achieving public school.
Fill out the short form below. We'll call you back and connect you with BLOCS, who handles the paperwork.
A business applies to the state through DCED's online system and names BLOCS as the scholarship organization. Individuals and smaller businesses can join the BLOCS Scholarship LLC instead, and BLOCS applies for them.
Once you're approved, you make your gift to BLOCS within 60 days and ask that it go to Acton Academy Pittsburgh. Acton then awards scholarships to families who qualify.
Any business authorized to do business in Pennsylvania that pays one of the eligible state taxes. These include Personal Income Tax for owners of S corporations, LLCs and partnerships, Corporate Net Income Tax, Bank Shares Tax and Insurance Premium Tax.
If you pay Pennsylvania income tax, you can take part by joining the BLOCS Scholarship LLC. It takes a two-year commitment of at least $3,000 a year. BLOCS sends you a K-1 showing your 90% credit to use on your PA return.
Scholarships go to families whose household income is no more than $122,322 a year, plus $21,531 for each dependent. You can direct your gift to Acton, but not to a specific child.
Say your business owes Pennsylvania $20,000 in state tax this year and gives $10,000 to scholarships through EITC.
| One year | Two-year commitment | |
|---|---|---|
| Gift to scholarships | $10,000 | $10,000 a year |
| PA tax credit | $7,500 | $9,000 a year |
| PA tax you still pay | $12,500 | $11,000 a year |
| What the gift really costs you | $2,500 | $1,000 a year |
The credit can't be more than the PA tax you owe that year. Federal tax treatment depends on your situation, so please check with your tax advisor.
Businesses renewing a two-year commitment, or in the middle of one, apply from May 15 to June 30. All other businesses, including first-time applicants, can apply starting July 1. The state approves applications in the order they come in, by day, until the credits run out, so earlier is better.
The state doesn't set one for businesses. BLOCS asks individuals who join its Scholarship LLC to give at least $3,000 a year for two years.
No. You can name Acton as the school, and Acton awards the scholarships to families who qualify.
The credit can't be more than your PA tax for that year. It can't be sold, refunded or carried to another year. The one exception is that a pass-through business, like an S corporation or LLC, can choose to pass unused credit to its owners for the following year.
Once the state approves your application, you have 60 days to make your gift, and proof of the gift is due within 90 days of the approval letter.
No. This page is general information. Please talk with your own tax advisor before you give. Pennsylvania sets the program rules, and they can change.
It takes about a minute. We'll get back to you to talk it through, and there's no obligation.
Prefer to talk? Call us at 724-201-3655.
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