08
LC 18 7395S/AP
House
Bill 1133 (AS PASSED HOUSE AND SENATE)
By:
Representatives Casas of the
103rd,
Ehrhart of the
36th,
Lindsey of the
54th,
Lewis of the
15th,
Stephens of the
164th,
and others
A
BILL TO BE ENTITLED
AN ACT
AN ACT
To
amend Titles 20 and 48 of the Official Code of Georgia Annotated, relating,
respectively, to education and revenue and taxation, so as to provide for a
program of educational improvement; to provide for definitions; to provide for
student scholarship organizations; to provide for procedures; to provide for an
income tax credit with respect to qualified education expenses; to provide for
an income tax exclusion with respect to certain scholarship amounts; to provide
for conditions and limitations; to provide for powers, duties, and authority of
the state revenue commissioner with respect to the foregoing; to provide for
related matters; to provide an effective date; to provide for applicability; to
repeal conflicting laws; and for other purposes.
BE
IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:
SECTION
1.
Title
20 of the Official Code of Georgia Annotated, relating to education, is amended
by adding a new chapter to read as follows:
"CHAPTER
2A
20-2A-1.
As
used in this chapter, the term:
(1)
'Eligible student' means a student who is a Georgia resident enrolled in a
Georgia secondary or primary public school or eligible to enroll in a qualified
kindergarten program or pre-kindergarten program.
(2)
'Qualified school or program' means a nonpublic primary school or secondary
school that:
(A)
Is accredited or in the process of becoming accredited by one or more entities
listed in subparagraph (A) of paragraph (6) of Code Section 20-3-519;
and
(B)
Is located in this state, adheres to the provisions of the federal Civil Rights
Act of 1964, and satisfies the requirements prescribed by law for private
schools in this state.
(3)
'Student scholarship organization' means a charitable organization in this state
that:
(A)
Is exempt from federal income taxation under Section 501(c)(3) of the Internal
Revenue Code and allocates 90 percent of its annual revenue for scholarships or
tuition grants to allow students to attend any qualified school of their
parents´ choice; and
(B)
Provides educational scholarships or tuition grants to eligible students without
limiting availability to only students of one school.
20-2A-2.
Each
student scholarship organization:
(1)
Must obligate 90 percent of its annual revenue for scholarships or tuition
grants; however, up to 25 percent of this amount may be carried forward for the
next fiscal year;
(2)
Must maintain separate accounts for scholarship funds and operating
funds;
(3)
May transfer funds to another student scholarship organization;
(4)
Must conduct an audit of its accounts by an independent certified public
accountant within 120 days after the completion of the student scholarship
organization´s fiscal year and provide such audit to the Department of
Revenue in accordance with Code Section 20-2A-3; and
(5)
Must annually submit notice to the Department of Education in accordance with
department guidelines of its participation as a student scholarship organization
under this chapter.
20-2A-3.
(a)
Each student scholarship organization must report to the Department of Revenue,
on a form provided by the Department of Revenue, by January 12 of each tax year
the following:
(1)
The total number and dollar value of contributions and tax credits approved;
and
(2)
A list of donors, including the dollar value of each donation and the dollar
value of each approved tax credit.
Such
report shall also include a copy of the audit conducted pursuant to paragraph
(4) of Code Section 20-2A-2.
(b)
The Department of Revenue shall not require any other information from student
scholarship organizations, except as expressly authorized in this
chapter.
20-2A-4.
The
Department of Revenue shall provide a list of all student scholarship
organizations receiving contributions from businesses and individuals granted a
tax credit under Code Section 48-7-29.13 to the General Assembly by January 30
of each year.
20-2A-5.
The
parent or guardian to whom a scholarship award is granted must restrictively
endorse the scholarship award to the private school for deposit into the account
of the private school. The parent or guardian may not designate any entity or
individual associated with the participating private school as the parent´s
attorney in fact to endorse a scholarship warrant. A participant who fails to
comply with this Code section forfeits the scholarship.
20-2A-6.
The
Department of Education shall maintain on its website a current list of all
student scholarship organizations which have provided notice pursuant to
paragraph (5) of Code Section 20-2A-2."
SECTION
2.
Title
48 of the Official Code of Georgia Annotated, relating to revenue and taxation,
is amended by adding a new Code section to read as follows:
"48-7-29.13.
(a)
As used in this Code section, the term:
(1)
'Qualified education expense' means the expenditure of funds by the taxpayer
during the tax year for which a credit under this Code section is claimed and
allowed to a student scholarship organization operating pursuant to Chapter 2A
of Title 20 which are used for tuition and fees for a qualified school or
program.
(2)
'Qualified school or program' shall have the same meaning as in paragraph (2)
of Code Section 20-2A-1.
(3)
'Student scholarship organization' shall have the same meaning as in paragraph
(3) of Code Section 20-2A-1.
(b)
An individual taxpayer shall be allowed a credit against the tax imposed by this
chapter for qualified education expenses as follows:
(1)
In the case of a single individual or a head of household, the actual amount
expended or $1,000.00 per tax year, whichever is less; or
(2)
In the case of a married couple filing a joint return, the actual amount
expended or $2,500.00 per tax year, whichever is less.
(c)
A corporation shall be allowed a credit against the tax imposed by this chapter
for qualified education expenses in an amount not to exceed the actual amount
expended or 75 percent of the corporation´s income tax liability, whichever
is less.
(d)
The tax credit shall not be allowed if the taxpayer designates the
taxpayer´s qualified education expense for the direct benefit of any
dependent of the taxpayer.
(e)
In no event shall the total amount of the tax credit under this Code section for
a taxable year exceed the taxpayer´s income tax liability. Any unused tax
credit shall be allowed the taxpayer against the succeeding five years´ tax
liability. No such credit shall be allowed the taxpayer against prior
years´ tax liability.
(f)(1)
In no event shall the aggregate amount of tax credits allowed under this Code
section exceed $50 million per tax year.
(2)
The commissioner shall allow the tax credits on a first come, first served
basis.
(3)
For the purposes of paragraph (1) of this subsection, a student scholarship
organization shall notify a potential donor of the requirements of this Code
section. Before making a contribution to a student scholarship organization,
the taxpayer shall notify the department of the total amount of contributions
that the taxpayer intends to make to the student scholarship organization. The
commissioner shall preapprove or deny the requested amount within 30 days after
receiving the request from the taxpayer. In order to receive a tax credit under
this Code section, the taxpayer shall make the contribution to the student
scholarship organization within 30 days after receiving notice from the
department that the requested amount was preapproved. If the taxpayer does not
comply with this paragraph, the commissioner shall not include this preapproved
contribution amount when calculating the limit prescribed in paragraph (1) of
this subsection.
(4)
Preapproval of contributions by the commissioner shall be based solely on the
availability of tax credits subject to the aggregate total limit established
under paragraph (1) of this subsection.
(g)
In order for the taxpayer to claim the student scholarship organization tax
credit under this Code section, a letter of confirmation of donation issued by
the student scholarship organization to which the contribution was made shall be
attached to the taxpayer´s tax return. The letter of confirmation of
donation shall contain the taxpayer´s name, address, tax identification
number, the amount of the contribution, the date of the contribution, and the
amount of the credit.
(h)(1)
No credit shall be allowed under this Code section with respect to any amount
deducted from taxable net income by the taxpayer as a charitable contribution to
a bona fide charitable organization qualified under Section 501(c)(3) of the
Internal Revenue Code.
(2)
The amount of any scholarship received by an eligible student or eligible
pre-kindergarten student shall be excluded from taxable net income for Georgia
income tax purposes.
(i)
The commissioner shall be authorized to promulgate any rules and regulations
necessary to implement and administer the tax provisions of this Code
section."
SECTION
3.
This
Act shall become effective upon its approval by the Governor or upon its
becoming law without such approval and shall be applicable to all taxable years
beginning on or after January 1, 2008.
SECTION
4.
All
laws and parts of laws in conflict with this Act are repealed.