The Watson Institute : PA Educational Tax Improvement Tax Credit Program

Through Pennsylvania's Educational Improvement Tax Credit (EITC) program, a qualified businesses can make a donation to The Watson Institute and receive tax credits equal to a percentage of their gift.

The Watson Institute is an approved Educational Improvement Organization (EIO) and an approved Scholarship Organization (SO) in the EITC program. Gifts through the EIO program enable Watson to provide community-based services to students with special needs in school districts throughout the region. Gifts through the SO allow Watson to offer scholarships to students in our Intense Behavioral Support Program (IBSP) who have considerable behavior challenges, but for whom their team feels, with intense behavioral support for a relatively short period of time, would be able to return to a classroom in their home school district.

Is your Company Eligible?

A company is eligible to donate to Watson through EITC if the company pays one of the following taxes:

Corporate Net Income Tax

Capital Stock Franchise Tax

Bank and Trust Company Shares Tax

Title Insurance Companies Share Tax

Insurance Premiums Tax

Mutual Thrift Institutions Tax

The Pennsylvania Department of Community and Economic Development determines the eligibility of businesses as well as educational improvement organizations.

What Steps Must a Company Take to Participate in EITC?

A company interested in giving to The Watson Institute through the EITC program must complete an application form. The form is available by calling the Department of Community and Economic Development at (717) 787-7120, accessing the PA Department of Economic Development's website online, or click here to download the application and instructions.

When should a company apply?

Both new and renewing EITC business participants receive approval on a first-come, first served basis. When the tax credits given to organizations equals the maximum allowed to be credited for the year, the Department of Community and Economic Development will close the EITC opportunity until the following year.

**The EITC credit limit for the EIO program is often reached one or two days after applications are accepted. After that time, the Department of Community and Economic Development can no longer offer EITC credits for the fiscal year. However, in the last few years, the credit limit for the EITC SO program has not been reached. In fact, almost $2 million in tax credits in the SO program went unused during the 2007-2008 budget year.**

First-time applicants: The first day you can apply depends on the fiscal year in which you would like to participate.

Fiscal year 2009-2010: Submit your application so that it reaches the Department of Community and Economic Development on the first day that applications are accepted. Typically, that day is July 1.

Renewing applicants:

Fiscal year 2009-2010: If your business participated in EITC during the 2008-2009 fiscal year, and you would like to renew for fiscal year 2009-2010, the first day you may submit your renewal application is May 15, 2009.

How Can My Company Benefit?

The maximum tax credit that a participating company will receive through an EITC donation to The Watson Institute is $300,000.

In July 2008 the Pennsylvania legislature approved the following amendments to the Educatinal Improvement Tax Credit (EITC) program for the 2008-09 budget year:

Subchapter S corporation and other business entities that pay their state business taxes under the personal icome tax on PA business income can now fully participate in the program.
The business tax cap is $300,000 for businesses contributing to scholarship organizations (SO) and educational improvement organizations (EIO). In previous years the tax cap was $200,000.

The Department of Community and Economic Development calculates the tax credit based on the length of the business' EITC commitment to Watson.

One-year contribution: A business that makes a one-year EITC contribution to Watson receives a tax credit equal to 75 percent of the donation.
Two-year contribution: A business that makes a two year contribution to Watson receives a tax credit equal to 90 percent of the donation. A two-year commitment must be made in writing and accompany the donation.

For More Information

Please contact Watson's Communications Specialist at (412) 749-2851 or via email.

Thank You!

The Watson Institute whole-heartedly thanks you for your contributions through the Educational Improvement Tax Credit program. Your donations allow Watson to support students with special needs in the public school setting.