BOAST Maryland Tax Credit

Tax Credits for Donations to Educational Scholarship Organizations will:

• Increase the availability of student scholarships for lower and middle income families.
  
• Stabilize tuition costs at nonpublic schools, creating more affordable education options in communities throughout the state.
  
• Provide nonpublic school teachers with greater access to professional development opportunities and scholarships for graduate-level coursework.
  
• Help nonpublic schools recruit and retain talented teachers, which promotes high-quality education

Tax Credits for Donations to Innovative Enrichment Organizations will:

• Increase the availability enrichment programs targeting public school students’ needs, such as tutoring, mentoring, arts, environmental, and other programs. These programs may enhance the quality of the education delivered inside public schools or offer learning opportunities after school hours.
  
• Provide public school teachers with access to professional development programs funded by business donations. These programs will help more teachers meet “highly qualified” standards.
  
• Help public schools enhance academic programs, develop new programs, and acquire new educational resources through partnerships with enrichment organizations.
  
• Increase the visibility of successful initiatives in local public schools.
  
• Help relieve overcrowding and other enrollment pressures on public schools by sustaining other affordable education options in the community.

• Businesses will receive a state income tax credit worth 75 percent of their donations to eligible scholarship organizations and enrichment programs, which will reduce their state tax burden.
  
• The BOAST tax credit will foster a thriving local educational system, which will attract new residents and talented employees to the community.
  
• Business donations to scholarship organizations will sustain enrollment in nonpublic schools, which save taxpayers about $1.5 billion each year in per pupil expenditures.

BUSINESS DONATIONS AND CREDITS
• Businesses may receive a tax credit against the state income tax of 75% of their total donation to an eligible organization.
• Businesses eligible for the credit include C corporations, S corporations, sole proprietorships, partnerships, limited liability corporations, and business trusts

EDUCATIONAL SCHOLARSHIP ORGANIZATIONS:
• Must be a 501(c)(3) organization that expends at least 85% of its annual receipts on scholarships
• Must provide scholarships to students attending at least four different schools
• Must provide scholarships on a priority basis to all student applicants who qualify for the federal Free and Reduced Price Meals program
• Must expend any remaining funds to provide scholarships on a sliding scale according to the financial need of other student applicants
• May provide up to 25% of their proceeds for scholarship grants to nonpublic- school teachers for the cost of graduate-level coursework or continuing professional development programs needed to meet or retain state certification or certification from the National Board for Professional Teaching Standards

INNOVATIVE EDUCATIONAL ORGANIZATIONS
• Must be a 501(c)(3) organization that expends at least 85% of its annual receipts on programs or services to public school students or teachers
• Must support enrichment programs for public-school students that reinforce the goals of the Bridge to Excellence Act
• May provide up to 25% of proceeds for professional development programs for public-school teachers needed to meet or retain state certification or certification from the National Board for Professional Teaching Standards

ADMINISTRATION
• Businesses submit an application for a state tax credit to the Maryland State Department of Education (MSDE), indicating the amount of their intended contribution
• MSDE approves tax credit applications on a first-come, first-served basis, according to the statewide limitations
• Educational Scholarship Organizations and Innovative Educational Organizations confirm receipt of each business contribution with MSDE
• MSDE provides businesses certification of their contributions for the purposes of filing for the credit on the business’ state income tax return

APPROVAL OF ORGANIZATIONS
• Educational Scholarship Organizations and Innovative Educational Organizations submit an application to MSDE verifying that they meet the statutory requirements of an approved organization
• MSDE must approve organizations’ applications within 60 days
• MSDE publishes a list of all approved organizations

Businesses will receive the tax credit for donations to Educational Scholarship Organizations that have been approved by the Maryland State Department of Education (MSDE). To be approved, an organization:

• Must be a 501(c)(3) organization that expends at least 85% of its annual receipts on scholarships.
  
• Must provide scholarships to students attending at least four different schools.
  
• Must provide scholarships on a priority basis to all student applicants who qualify for the federal Free and Reduced Price Meals program.
  
• Must expend any remaining funds to provide scholarships on a sliding scale according to the financial need of other student applicants.
  
• May provide up to 25% of their proceeds for scholarship grants to nonpublic- school teachers for the cost of graduate-level coursework or continuing professional. development programs needed to meet or retain state certification or certification from the National Board for Professional Teaching Standards.

Businesses will receive the tax credit for donations to Innovative Enrichment Organizations that have been approved by the Maryland State Department of Education (MSDE). To be approved, an organization:

• Must be a 501(c)(3) organization that expends at least 85% of its annual receipts on programs or services to public school students or teachers.
  
• Must support enrichment programs for public-school students that reinforce the goals of the Bridge to Excellence Act.
  
• May provide up to 25% of proceeds for professional development programs for public-school teachers needed to meet or retain state certification or certification from the National Board for Professional Teaching Standards.