This bill has been amended

Bill S2732-2011

Establishes an education investment tax credit

Establishes an education investment tax credit.

Details

Actions

  • Jan 4, 2012: REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • Jan 4, 2012: returned to senate
  • Jan 4, 2012: died in assembly
  • Jun 21, 2011: referred to ways and means
  • Jun 21, 2011: DELIVERED TO ASSEMBLY
  • Jun 21, 2011: PASSED SENATE
  • Jun 21, 2011: ORDERED TO THIRD READING CAL.1453
  • Jun 21, 2011: COMMITTEE DISCHARGED AND COMMITTED TO RULES
  • Jun 2, 2011: REPORTED AND COMMITTED TO FINANCE
  • Jan 31, 2011: REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS

Meetings

Calendars

Votes

VOTE: COMMITTEE VOTE: - Investigations and Government Operations - Jun 2, 2011
Ayes (6): Marcellino, Alesi, Golden, Nozzolio, Zeldin, Diaz
Ayes W/R (2): Squadron, Peralta
VOTE: COMMITTEE VOTE: - Rules - Jun 21, 2011
Ayes (18): Skelos, Alesi, Farley, Hannon, Johnson, Larkin, LaValle, Libous, Marcellino, Maziarz, Nozzolio, Seward, Sampson, Breslin, Dilan, Hassell-Thompson, Smith, Stewart-Cousins
Ayes W/R (2): Saland, Duane
Nays (4): Krueger, Montgomery, Parker, Perkins

Memo

BILL NUMBER:S2732

TITLE OF BILL: An act to amend the tax law, in relation to enacting the "education investment incentives act"

PURPOSE: This bill would authorize a personal tax credit up to $6,000 and a corporate tax credit up to $15,000 for contributions to public education entities, or to charitable organizations which offer tuition assistance, or up to $75 for expenses incurred by school personnel and parents who educate their children at home.

SUMMARY OF PROVISIONS: This bill would permit individual public schools, including charter schools, to accept and receive voluntary cash contributions. It also amends section 606 of the tax law to define a "local education fund" as a charitable organization in this state that is exempt from federal taxation under section 501(c) (3) of the Internal Revenue Code and is established for the specific purpose of supporting public education within a specific public school district; a "school tuition organization" as a charitable organization in this state that is exempt from federal taxation under section 501(c) (3) of the Internal Revenue Code, allocates at least eighty-seven percent of its annual expenditures for financial assistance to students in order that they may attend an eligible nonpublic school, and provides such assistance to students in more than one such school. It adds subsections to section 606 to allow a 60% tax credit up to $6,000 in any taxable year for voluntary cash contributions to public education entities, or to school tuition organizations, or up to $75 for the purchase of instructional materials and classroom supplies for schools or nonpublic home-based instruction. Contributions to local education funds or to school tuition organizations may not be designated for the direct benefit of any particular student. It would also add a subsection to section 210 of the tax law to allow a 60% credit up to $15,000 for cash contributions to public education entities or to local education funds, or to school tuition organizations. A subsection is also added to section 171 of the tax law to establish an annual limit of two hundred million dollars for such credits. Contributions exceeding this limit shall be applied to the following tax year and the donor so notified.

JUSTIFICATION: One of the most vexing problems facing policy makers and educators is the funding of our educational system. When crafting annual school budgets, school officials must grapple with rising costs, fluctuating state and federal aid, and an often-unstable local tax base. These ever-changing dynamics result in valuable educational programs being reduced, eliminated or never actually started. It is necessary to encourage greater private sector support of educational opportunities for children. Private sector resources, from both individuals and businesses, not only to help stabilize the school budget process, but allow schools to maintain, expand or begin worthwhile programs. An education investment tax credit, as established by this act, will

involve the private sector, both individuals and corporations, and may encourage donations to public education entities, along with educational scholarship organizations benefitting students attending independent and religious schools. The tax credit provided in this act is merely one of many credits available to New York taxpayers. The intended beneficiaries of the tax credit provided in this act are the students who attend public schools, charter schools, and anyone who furthers their education using tuition scholarships from educational scholarship organizations, or who participates in a home-based educational program. The tax credit does not constitute public aid to non-public sectarian institutions; permitting school personnel to claim a credit for the purchase of classroom instructional materials and supplies will insure a wider availability of such materials and supplies for all students.

LEGISLATIVE HISTORY: Similar to S.5146 of 2009-10 - Reported from Investigations, Referred to Finance.

FISCAL IMPLICATIONS: The Department of Taxation & Finance has yet to project a first-year revenue reduction. However, as it would affect only the Fourth Quarter of FY 2011-12, it would be less than the $200 million allowed when fully implemented. Since the bill allows only a partial credit, it has the potential to generate $333 million in voluntary contributions to support K-12 education in New York State. Stabilizing the independent and religious sector will significantly lessen the need for local school tax increases as well as for the issuance of bonds for new public school construction, generating further savings for the state.

EFFECTIVE DATE: This act shall take effect on the first day of January next succeeding the date on which it shall have become a law.


Text

STATE OF NEW YORK ________________________________________________________________________ 2732 2011-2012 Regular Sessions IN SENATE January 31, 2011 ___________
Introduced by Sens. GOLDEN, GRISANTI, MARTINS, MAZIARZ -- read twice and ordered printed, and when printed to be committed to the Committee on Investigations and Government Operations AN ACT to amend the tax law, in relation to enacting the "education investment incentives act" THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Short title. This act shall be known and may be cited as the "education investment incentives act". S 2. Legislative findings and intent. The legislature hereby finds and declares that: a. At a time when the state is considering ways of reducing the tax burden for New York state residents and educators are seeking an expan- sion of financial resources, charitable giving for educational purposes should be stimulated; b. Permitting public education entities such as school districts and individual public schools, including charter schools, to accept and receive voluntary cash contributions will lessen the need for additional tax revenue; c. Encouraging voluntary support for education, without prejudice for or against any state-sanctioned educational enterprise, promotes the state's interest in providing the highest quality education to all chil- dren in the state; d. Requiring a sharing of resources among school districts will insure a more equitable distribution of financial support; e. The tax credit provided in this act is merely one of many credits available to New York taxpayers; f. The intended beneficiaries of the tax credit provided in this act are the students who attend public schools, including charter schools, or who further their educations using tuition scholarships from educa- tional scholarship organizations, or who participate in home-based
educational programs; therefore the tax credit does not constitute public aid to non-public sectarian institutions; g. Permitting school personnel to claim a credit for the purchase of classroom instructional materials and supplies will insure a wider availability of such materials and supplies for all students. S 3. Section 606 of the tax law is amended by adding five new subsections (u), (v), (w), (w-1) and (w-2) to read as follows: (U) DEFINITIONS. AS USED IN SUBSECTIONS (V), (W), (W-1) AND (W-2) OF THIS SECTION, THE FOLLOWING TERMS SHALL HAVE THE FOLLOWING MEANINGS: (1) "PUBLIC EDUCATION ENTITY" SHALL MEAN ANY PUBLIC SCHOOL DISTRICT OR ANY INDIVIDUAL PUBLIC SCHOOL, INCLUDING ANY CHARTER SCHOOL. (2) "LOCAL EDUCATION FUND" SHALL MEAN A CHARITABLE ORGANIZATION IN THIS STATE THAT: (A) IS EXEMPT FROM FEDERAL TAXATION UNDER SECTION 501 (C)(3) OF THE INTERNAL REVENUE CODE; AND (B) IS ESTABLISHED FOR THE EXPLICIT PURPOSE OF SUPPORTING PUBLIC EDUCATION WITHIN A SPECIFIC PUBLIC SCHOOL DISTRICT. (3) "EDUCATIONAL SCHOLARSHIP ORGANIZATION" SHALL MEAN A CHARITABLE ORGANIZATION IN THIS STATE THAT: (A) IS EXEMPT FROM FEDERAL TAXATION UNDER SECTION 501 (C)(3) OF THE INTERNAL REVENUE CODE; AND (B) ALLOCATES AT LEAST EIGHTY-SEVEN PERCENT OF ITS ANNUAL EXPENDITURES FOR EDUCATIONAL SCHOLARSHIPS OR TUITION GRANTS TO CHILDREN ALLOWING THEM TO ATTEND ANY ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL AND/OR TO RECEIVE TUTORING AND MENTORING SERVICES IN AN ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL, OR FOR OTHER EDUCATIONAL PURPOSES; AND (C) MAKES EDUCATIONAL SCHOLARSHIPS, WHICH MAY INCLUDE SCHOLARSHIPS FOR TUTORING AND MENTORING SERVICES, OR TUITION GRANTS AVAILABLE TO CHILDREN FROM MORE THAN ONE PUBLIC OR ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL; AND (D) REPORTS ANNUALLY TO THE DEPARTMENT THE GROSS RECEIPTS AND GROSS AMOUNT EXPENDED FOR SCHOLARSHIPS AND TUITION GRANTS, MENTORING SERVICES, AND OTHER EDUCATIONAL PURPOSES. (4) "ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL" SHALL MEAN ANY RELI- GIOUS OR INDEPENDENT PRIMARY OR SECONDARY SCHOOL THAT IS LOCATED IN THIS STATE, THAT SATISFIES THE REQUIREMENTS PRESCRIBED BY LAW FOR SUCH SCHOOLS IN THIS STATE, AND THAT HAS QUALIFIED FOR FEDERAL TAX EXEMPTION UNDER SECTION 501 (C)(3) OF THE INTERNAL REVENUE CODE. (5) "AUTHORIZED CERTIFICATE OF RECEIPT" SHALL MEAN A CERTIFICATE DESIGNED BY THE COMMISSIONER FOR THE PURPOSE OF ACKNOWLEDGING RECEIPT OF A CHARITABLE CONTRIBUTION BY THE CHIEF EXECUTIVE OFFICER OF A PUBLIC EDUCATION ENTITY, OR OF A LOCAL EDUCATION FUND OR OF AN EDUCATIONAL SCHOLARSHIP ORGANIZATION. (V) CONTRIBUTIONS TO PUBLIC EDUCATION CREDIT. FOR TAXABLE YEARS BEGIN- NING ON OR AFTER JANUARY FIRST, TWO THOUSAND TWELVE, A CREDIT IS ALLOWED AGAINST THE TAX IMPOSED BY THIS ARTICLE FOR VOLUNTARY CASH CONTRIBUTIONS MADE BY THE TAXPAYER DURING THE TAXABLE YEAR TO A PUBLIC EDUCATION ENTI- TY. ACCEPTANCE AND RECEIPT OF ALL SUCH CONTRIBUTIONS SHALL BE PERMITTED. A TAXPAYER WHO SUBMITS WITH HIS OR HER TAX RETURN AN AUTHORIZED CERTIF- ICATE OF RECEIPT SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS HEREIN- AFTER PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTICLE. (1) THE AMOUNT OF THE CREDIT. (A) THIS CREDIT SHALL BE VALUED AT SIXTY PERCENT OF SUCH CONTRIB- UTIONS, NOT TO EXCEED SIX THOUSAND DOLLARS IN ANY TAXABLE YEAR. (B) A SHAREHOLDER OF A NEW YORK S CORPORATION OR A PARTNER OF A PART- NERSHIP (OR OTHER ENTITY TREATED AS A PARTNERSHIP FOR INCOME TAX
PURPOSES) SHALL BE TREATED AS THE TAXPAYER WITH RESPECT TO HIS OR HER PRO-RATA SHARE OF THE TAX CREDIT ALLOWABLE TO SUCH S CORPORATION OR PARTNERSHIP, DETERMINED FOR THE S CORPORATION'S OR PARTNERSHIP'S TAXABLE YEAR ENDING WITH OR WITHIN THE SHAREHOLDER'S OR PARTNER'S TAXABLE YEAR. THE MAXIMUM AMOUNT OF THE CREDIT FOR SUCH S CORPORATION OR PARTNERSHIP SHALL BE THE SAME AS THAT ALLOWABLE TO CORPORATIONS UNDER SUBDIVISIONS FORTY-FOUR AND FORTY-FIVE OF SECTION TWO HUNDRED TEN OF THIS CHAPTER. (2) A HUSBAND AND WIFE WHO FILE SEPARATE RETURNS FOR A TAXABLE YEAR IN WHICH THEY COULD HAVE FILED A JOINT RETURN MAY EACH CLAIM ONLY ONE-HALF OF THE TAX CREDIT THAT WOULD HAVE BEEN ALLOWED FOR A JOINT RETURN. (3) IF THE ALLOWABLE TAX CREDIT EXCEEDS THE TAXES OTHERWISE DUE UNDER THIS ARTICLE ON THE TAXPAYER'S INCOME, OR IF THERE ARE NO TAXES DUE UNDER THIS ARTICLE, THE TAXPAYER MAY CARRY THE AMOUNT OF THE CREDIT NOT USED TO OFFSET THE TAXES UNDER THIS ARTICLE FORWARD FOR NOT MORE THAN FIVE YEARS INCOME TAX LIABILITY. (4) CONTRIBUTIONS OF TEN THOUSAND DOLLARS OR LESS IN ANY TAXABLE YEAR SHALL NOT BE CONSIDERED ELIGIBLE DEDUCTIONS AS ALLOWED UNDER THIS ARTI- CLE FOR CHARITABLE CONTRIBUTIONS. CONTRIBUTIONS IN EXCESS OF TEN THOU- SAND DOLLARS IN ANY TAXABLE YEAR SHALL BE CONSIDERED ELIGIBLE DEDUCTIONS AS ALLOWED UNDER THIS ARTICLE FOR CHARITABLE CONTRIBUTIONS. (5) SUCH CONTRIBUTIONS SHALL BE DEPOSITED IN A SEPARATE ACCOUNT. (6) IF MADE TO A PUBLIC SCHOOL DISTRICT SUCH CONTRIBUTIONS SHALL BE SUPERVISED BY A PERSON SO DESIGNATED BY THE CHANCELLOR OR SUPERINTEN- DENT. IF MADE TO A PARTICULAR SCHOOL THEY SHALL BE SUPERVISED BY THE SCHOOL PRINCIPAL. REPORTS OF DEPOSITS AND DISBURSEMENTS SHALL BE MADE TO THE LOCAL BOARD OF EDUCATION ANNUALLY. CHARTER SCHOOLS SHALL MAKE SUCH REPORTS TO THE STATE EDUCATION DEPARTMENT. (W) CONTRIBUTIONS TO LOCAL EDUCATION FUND CREDIT. IN LIEU OF CONTRIB- UTIONS IN SUBSECTION (V) OF THIS SECTION, A CREDIT IS ALLOWED: (1) FOR THE AMOUNT OF VOLUNTARY CASH CONTRIBUTIONS MADE BY THE TAXPAY- ER DURING THE TAXABLE YEAR TO A LOCAL EDUCATION FUND. A TAXPAYER WHO SUBMITS WITH HIS OR HER TAX RETURN AN AUTHORIZED CERTIFICATE OF RECEIPT SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS HEREINAFTER PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTICLE. (A) THIS CREDIT SHALL BE VALUED AT SIXTY PERCENT OF SUCH CONTRIB- UTIONS, NOT TO EXCEED SIX THOUSAND DOLLARS IN ANY TAXABLE YEAR. A SHARE- HOLDER OF A NEW YORK S CORPORATION OR A PARTNER OF A PARTNERSHIP (OR OTHER ENTITY TREATED AS A PARTNERSHIP FOR INCOME TAX PURPOSES) SHALL BE TREATED AS THE TAXPAYER WITH RESPECT TO HIS OR HER PRO-RATA SHARE OF THE TAX CREDIT ALLOWABLE TO SUCH S CORPORATION OR PARTNERSHIP, DETERMINED FOR THE S CORPORATION'S OR PARTNERSHIP'S TAXABLE YEAR ENDING WITH OR WITHIN THE SHAREHOLDER'S OR PARTNER'S TAXABLE YEAR. THE MAXIMUM AMOUNT OF THE CREDIT FOR SUCH S CORPORATION OR PARTNERSHIP SHALL BE THE SAME AS THAT ALLOWABLE TO CORPORATIONS UNDER SUBDIVISIONS FORTY-FOUR AND FORTY- FIVE OF SECTION TWO HUNDRED TEN OF THIS CHAPTER. (B) A HUSBAND AND WIFE WHO FILE SEPARATE RETURNS FOR A TAXABLE YEAR IN WHICH THEY COULD HAVE FILED A JOINT RETURN MAY EACH CLAIM ONLY ONE-HALF OF THE TAX CREDIT THAT WOULD HAVE BEEN ALLOWED FOR A JOINT RETURN. (C) IF THE ALLOWABLE TAX CREDIT EXCEEDS THE TAXES OTHERWISE DUE UNDER THIS ARTICLE ON THE TAXPAYER'S INCOME, OR IF THERE ARE TAXES DUE UNDER THIS ARTICLE, THE TAXPAYER MAY CARRY THE AMOUNT OF THE CREDIT NOT USED TO OFFSET THE TAXES UNDER THIS ARTICLE FORWARD FOR NOT MORE THAN FIVE YEARS' INCOME TAX LIABILITY. (D) CONTRIBUTIONS IN EXCESS OF TEN THOUSAND DOLLARS IN ANY TAXABLE YEAR SHALL BE CONSIDERED ELIGIBLE DEDUCTIONS AS ALLOWED UNDER THIS ARTI- CLE FOR CHARITABLE CONTRIBUTIONS.
(E) THIS TAX CREDIT MAY NOT BE CLAIMED FOR ANY CONTRIBUTION TO A LOCAL EDUCATION FUND FOR THE BENEFIT OF A DESIGNATED STUDENT. (2) FOR THE AMOUNT OF VOLUNTARY CASH CONTRIBUTIONS MADE BY THE TAXPAY- ER DURING THE TAXABLE YEAR TO AN EDUCATIONAL SCHOLARSHIP ORGANIZATION. A TAXPAYER WHO SUBMITS WITH HIS OR HER TAX RETURN AN AUTHORIZED CERTIF- ICATE OF RECEIPT SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS HEREINAFT- ER PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTICLE. (A) THIS CREDIT SHALL BE VALUED AT SIXTY PERCENT OF SUCH CONTRIB- UTIONS, NOT TO EXCEED SIX THOUSAND DOLLARS IN ANY TAXABLE YEAR. A SHARE- HOLDER OF A NEW YORK S CORPORATION OR A PARTNER OF A PARTNERSHIP (OR OTHER ENTITY TREATED AS A PARTNERSHIP FOR INCOME TAX PURPOSES) SHALL BE TREATED AS THE TAXPAYER WITH RESPECT TO HIS OR HER PRO-RATA SHARE OF THE TAX CREDIT ALLOWABLE TO SUCH S CORPORATION OR PARTNERSHIP, DETERMINED FOR THE S CORPORATION'S OR PARTNERSHIP'S TAXABLE YEAR ENDING WITH OR WITHIN THE SHAREHOLDER'S OR PARTNER'S TAXABLE YEAR. THE MAXIMUM AMOUNT OF THE CREDIT FOR SUCH S CORPORATION OR PARTNERSHIP SHALL BE THE SAME AS THAT ALLOWABLE TO CORPORATIONS UNDER SUBDIVISIONS FORTY-FOUR AND FORTY- FIVE OF SECTION TWO HUNDRED TEN OF THIS CHAPTER. (B) A HUSBAND AND WIFE WHO FILE SEPARATE RETURNS FOR A TAXABLE YEAR IN WHICH THEY COULD HAVE FILED A JOINT RETURN MAY EACH CLAIM ONLY ONE-HALF OF THE TAX CREDIT THAT WOULD HAVE BEEN ALLOWED FOR A JOINT RETURN. (C) IF THE ALLOWABLE TAX CREDIT EXCEEDS THE TAXES OTHERWISE DUE UNDER THIS ARTICLE ON THE TAXPAYER'S INCOME, OR IF THERE ARE NO TAXES DUE UNDER THIS ARTICLE, THE TAXPAYER MAY CARRY THE AMOUNT OF THE CREDIT NOT USED TO OFFSET THE TAXES UNDER THIS ARTICLE FORWARD FOR NOT MORE THAN FIVE YEARS' INCOME TAX LIABILITY. (D) CONTRIBUTIONS IN EXCESS OF TEN THOUSAND DOLLARS IN ANY TAXABLE YEAR SHALL BE CONSIDERED ELIGIBLE DEDUCTIONS AS ALLOWED UNDER THIS ARTI- CLE FOR CHARITABLE CONTRIBUTIONS. (E) THIS TAX CREDIT MAY NOT BE CLAIMED FOR ANY CONTRIBUTION TO AN EDUCATIONAL SCHOLARSHIP ORGANIZATION FOR THE BENEFIT OF A DESIGNATED STUDENT. (W-1) HOME-BASED INSTRUCTIONAL MATERIALS CREDIT. IN LIEU OF CONTRIB- UTIONS IN SUBSECTIONS (V) AND (W) OF THIS SECTION, A CREDIT IS ALLOWED FOR THE PURCHASE OF INSTRUCTIONAL MATERIALS FOR NON-PUBLIC HOME-BASED EDUCATIONAL PROGRAMS. THIS CREDIT SHALL BE VALUED AT SIXTY PERCENT OF SUCH PURCHASES. (1) THE AMOUNT OF SUCH CREDIT SHALL NOT EXCEED SEVENTY-FIVE DOLLARS IN ANY TAXABLE YEAR. (2) A HUSBAND AND WIFE WHO FILE SEPARATE RETURNS FOR A TAXABLE YEAR IN WHICH THEY COULD HAVE FILED A JOINT RETURN MAY EACH CLAIM ONLY ONE-HALF OF THE TAX CREDIT THAT WOULD HAVE BEEN ALLOWED FOR A JOINT RETURN. (3) IF THE ALLOWABLE TAX CREDIT EXCEEDS THE TAXES OTHERWISE DUE UNDER THIS ARTICLE ON THE TAXPAYER'S INCOME, OR IF THERE ARE NO TAXES DUE UNDER THIS ARTICLE, THE TAXPAYER MAY CARRY THE AMOUNT OF THE CREDIT NOT USED TO OFFSET THE TAXES UNDER THIS ARTICLE FORWARD FOR NOT MORE THAN FIVE YEARS' INCOME TAX LIABILITY. (4) IF THE TAXPAYER SHALL BE RESPONSIBLE FOR NOTIFYING THE COMMISSION- ER OF THE INTENTION TO CLAIM THE ALLOWABLE CREDIT, NO LATER THAN DECEM- BER THIRTY-FIRST. (W-2) CLASSROOM INSTRUCTIONAL MATERIALS AND SUPPLIES CREDIT. A CREDIT IS ALLOWED FOR THE PURCHASE OF CLASSROOM INSTRUCTIONAL MATERIALS AND SUPPLIES FOR PERSONNEL EMPLOYED IN ANY PUBLIC SCHOOL, INCLUDING ANY CHARTER SCHOOL, OR IN ANY ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL.
(1) THIS CREDIT SHALL BE VALUED AT SIXTY PERCENT OF SUCH PURCHASES. THE AMOUNT OF SUCH CREDIT SHALL NOT EXCEED SEVENTY-FIVE DOLLARS IN ANY TAXABLE YEAR. (2) THE TAXPAYER SHALL BE RESPONSIBLE FOR NOTIFYING THE COMMISSIONER OF THE INTENTION TO CLAIM THE ALLOWABLE CREDIT, NO LATER THAN DECEMBER THIRTY-FIRST, INDICATING WHETHER THE PURCHASE WAS MADE FOR USE IN A PUBLIC SCHOOL, INCLUDING A CHARTER SCHOOL, OR AN ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL. S 4. Section 210 of the tax law is amended by adding four new subdivi- sions 43, 44, 45 and 46 to read as follows: 43. DEFINITIONS. AS USED IN SUBDIVISIONS FORTY-FOUR AND FORTY-FIVE OF THIS SECTION THE FOLLOWING TERMS SHALL HAVE THE FOLLOWING MEANINGS: (A) "PUBLIC EDUCATION ENTITY" SHALL MEAN ANY PUBLIC SCHOOL DISTRICT OR ANY INDIVIDUAL PUBLIC SCHOOL, INCLUDING ANY CHARTER SCHOOL. (B) "LOCAL EDUCATION FUND" SHALL MEAN A CHARITABLE ORGANIZATION IN THIS STATE THAT: (1) IS EXEMPT FROM FEDERAL TAXATION UNDER SECTION 501(C) (3) OF THE INTERNAL REVENUE CODE; AND (2) IS ESTABLISHED FOR THE EXPLICIT PURPOSE OF SUPPORTING PUBLIC EDUCATION WITHIN A SPECIFIC PUBLIC SCHOOL DISTRICT; AND (3) REPORTS ANNUALLY TO THE DEPARTMENT THE GROSS RECEIPTS AND GROSS AMOUNT EXPENDED IN SUPPORT OF PUBLIC EDUCATION. (C) "EDUCATIONAL SCHOLARSHIP ORGANIZATION" SHALL MEAN A CHARITABLE ORGANIZATION IN THIS STATE THAT: (1) IS EXEMPT FROM FEDERAL TAXATION UNDER SECTION 501(C)(3) OF THE INTERNAL REVENUE CODE; AND (2) ALLOCATES AT LEAST EIGHTY-SEVEN PERCENT OF ITS ANNUAL EXPENDITURES FOR EDUCATIONS SCHOLARSHIPS OR TUITION GRANTS TO CHILDREN ALLOWING THEM TO ATTEND ANY ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL AND/OR TO RECEIVE TUTORING AND MENTORING SERVICES IN AN ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL, OR FOR OTHER EDUCATIONAL PURPOSES; AND (3) MAKES EDUCATIONAL SCHOLARSHIPS, WHICH MAY INCLUDE SCHOLARSHIPS FOR TUTORING AND MENTORING SERVICES, OR TUITION GRANTS AVAILABLE TO CHILDREN FROM MORE THAN ONE PUBLIC OR ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL; AND (4) REPORTS ANNUALLY TO THE DEPARTMENT THE GROSS RECEIPTS AND GROSS AMOUNT EXPENDED FOR SCHOLARSHIPS AND TUITION GRANTS. (D) "ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL" SHALL MEAN ANY RELI- GIOUS OR INDEPENDENT PRIMARY OR SECONDARY SCHOOL THAT IS LOCATED IN THIS STATE, THAT SATISFIES THE REQUIREMENTS PRESCRIBED BY LAW FOR SUCH SCHOOLS IN THIS STATE, AND THAT HAS QUALIFIED FOR FEDERAL TAX EXEMPTION UNDER SECTION 501(C)(3) OF THE INTERNAL REVENUE CODE. (E) "AUTHORIZED CERTIFICATE OF RECEIPT" SHALL MEAN A CERTIFICATE DESIGNED BY THE COMMISSIONER FOR THE PURPOSE OF ACKNOWLEDGING RECEIPT OF A CHARITABLE CONTRIBUTION BY THE CHIEF EXECUTIVE OFFICER OF A PUBLIC EDUCATION ENTITY, OR OF A LOCAL EDUCATION FUND OR OF AN EDUCATIONAL SCHOLARSHIP ORGANIZATION. 44. CONTRIBUTIONS TO PUBLIC EDUCATION CREDIT. (A) FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOUSAND TWELVE, A CREDIT IS ALLOWED AGAINST THE TAX IMPOSED BY THIS ARTICLE FOR VOLUNTARY CASH CONTRIBUTIONS MADE BY THE TAXPAYER DURING THE TAXABLE YEAR TO A PUBLIC EDUCATION ENTITY. ACCEPTANCE AND RECEIPT OF ALL SUCH CONTRIBUTIONS SHALL BE PERMITTED. A TAXPAYER WHO SUBMITS WITH HIS OR HER TAX CREDIT, TO BE COMPUTED AS HEREINAFTER PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTI- CLE. THIS CREDIT SHALL BE VALUED AT SIXTY PERCENT OF SUCH CONTRIBUTIONS, NOT TO EXCEED FIFTEEN THOUSAND DOLLARS IN ANY TAXABLE YEAR.
(B) SUCH CONTRIBUTIONS SHALL BE DEPOSITED IN A SEPARATE ACCOUNT. (C) IF MADE TO A PUBLIC SCHOOL DISTRICT SUCH CONTRIBUTIONS SHALL BE SUPERVISED BY A PERSON SO DESIGNATED BY THE CHANCELLOR OR SUPERINTEN- DENT. IF MADE TO A PARTICULAR SCHOOL THEY SHALL BE SUPERVISED BY THE SCHOOL PRINCIPAL. REPORTS OF DEPOSITS AND DISBURSEMENTS SHALL BE MADE TO THE LOCAL BOARD OF EDUCATION ANNUALLY. CHARTER SCHOOLS SHALL MAKE SUCH REPORTS TO THE STATE EDUCATION DEPARTMENT. 45. CONTRIBUTIONS TO LOCAL EDUCATION FUND CREDIT. IN LIEU OF CONTRIB- UTIONS IN SUBDIVISION FORTY-FOUR OF THIS SECTION, A CREDIT IS ALLOWED: (A) FOR THE AMOUNT OF VOLUNTARY CASH CONTRIBUTIONS MADE BY THE TAXPAY- ER DURING THE TAXABLE YEAR TO A LOCAL EDUCATION FUND. A TAXPAYER WHO SUBMITS WITH HIS OR HER TAX RETURN AN AUTHORIZED CERTIFICATE OF RECEIPT SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS HEREINAFTER PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTICLE. (1) THE AMOUNT OF SUCH CREDIT SHALL BE VALUED AT SIXTY PERCENT OF SUCH CONTRIBUTIONS, NOT TO EXCEED FIFTEEN THOUSAND DOLLARS IN ANY TAXABLE YEAR. (2) THIS TAX CREDIT MAY NOT BE CLAIMED FOR ANY CONTRIBUTION TO A LOCAL EDUCATION FUND FOR THE BENEFIT OF A DESIGNATED STUDENT. (B) FOR THE AMOUNT OF VOLUNTARY CASH CONTRIBUTIONS MADE BY THE TAXPAY- ER DURING THE TAXABLE YEAR TO AN EDUCATIONAL SCHOLARSHIP ORGANIZATION. A TAXPAYER WHO SUBMITS WITH HIS OR HER TAX RETURN AN AUTHORIZED CERTIF- ICATE OF RECEIPT SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS HEREINAFT- ER PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTICLE. (1) THE AMOUNT OF SUCH CREDIT SHALL BE VALUED AT SIXTY PERCENT OF SUCH CONTRIBUTIONS, NOT TO EXCEED FIFTEEN THOUSAND DOLLARS IN ANY TAXABLE YEAR. (2) THIS TAX CREDIT MAY NOT BE CLAIMED FOR ANY CONTRIBUTION TO AN EDUCATIONAL SCHOLARSHIP ORGANIZATION FOR THE BENEFIT OF A DESIGNATED STUDENT. 46. SCHOOL DISTRICTS RECEIVING CONTRIBUTIONS IN EXCESS OF ONE PERCENT OF THEIR PREVIOUS YEAR'S BUDGET SHALL BE REQUIRED TO REMIT A MINIMUM OF THIRTY-FIVE PERCENT OF ANY SUCH EXCESS AMOUNT TO A FUND ADMINISTERED BY THE COMMISSIONER, TO BE DISTRIBUTED TO SCHOOL DISTRICTS RECEIVING LESS THAN ONE-HALF OF ONE PERCENT OF THEIR PREVIOUS YEAR'S BUDGET. CONTRIB- UTIONS TO SCHOOL DISTRICTS, TO INDIVIDUAL SCHOOLS (NOT INCLUDING CHARTER SCHOOLS) AND TO LOCAL EDUCATION FUNDS SHALL BE AGGREGATED FOR THE PURPOSES OF THIS SECTION. SUCH PAYMENTS SHALL BE CALCULATED ON A CALEN- DAR YEAR BASIS AND SHALL BE MADE NO LATER THAN MARCH FIRST OF THE FOLLOWING YEAR. S 5. Section 171 of the tax law is amended by adding a new subdivision twenty-ninth to read as follows: TWENTY-NINTH. FOR THE PURPOSE OF IMPLEMENTING THE PROVISIONS OF SUBSECTIONS (U), (V), (W), (W-1) AND (W-2) OF SECTION SIX HUNDRED SIX AND SUBDIVISIONS FORTY-THREE, FORTY-FOUR, FORTY-FIVE AND FORTY-SIX OF SECTION TWO HUNDRED TEN OF THIS CHAPTER THE COMMISSIONER SHALL: (1) REGISTER PUBLIC SCHOOL DISTRICTS, INDIVIDUAL PUBLIC SCHOOLS, INCLUDING CHARTER SCHOOLS, LOCAL EDUCATION FUNDS, AND EDUCATIONAL SCHOL- ARSHIP ORGANIZATIONS; AND (2) UPON NOTIFICATION BY THE CHIEF EXECUTIVE OFFICER OF ANY EDUCATION ENTITY SO REGISTERED THAT A CONTRIBUTION HAS BEEN RECEIVED, SUCH NOTIFI- CATION BEING WITHIN ONE BUSINESS DAY OF SAID RECEIPT, RECORD THE AMOUNT AND DATE OF THE CONTRIBUTION, THE NAME AND ADDRESS OF THE CONTRIBUTOR; AND (3) UPON NOTIFICATION THAT A CREDIT FOR THE PURCHASE OF INSTRUCTIONAL MATERIALS FOR NON-PUBLIC HOME-BASED EDUCATIONAL PROGRAMS, RECORD THE
AMOUNT AND DATE OF THE NOTIFICATION, THE NAME AND ADDRESS OF THE CLAIM- ANT; AND (4) UPON NOTIFICATION THAT A CREDIT FOR THE PURCHASE OF THE CLASSROOM INSTRUCTIONAL MATERIALS AND SUPPLIES, RECORD THE AMOUNT AND DATE OF THE NOTIFICATION, THE NAME AND ADDRESS OF THE CLAIMANT, AND WHETHER THE PURCHASE WAS MADE FOR USE IN A PUBLIC SCHOOL, INCLUDING A CHARTER SCHOOL, OR AN ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL; AND (5) MAKE NO MORE THAN TWO HUNDRED MILLION DOLLARS IN CREDITS AVAILABLE IN ANY SINGLE TAX YEAR, PROVIDED FURTHER THAT FIFTY PERCENT OF SUCH CREDITS SHALL BE AFFORDED TO TAXPAYERS WHO MAKE DONATIONS TO PUBLIC EDUCATION ENTITIES AND LOCAL EDUCATION FUNDS, AND FOR THE PURCHASE OF CLASSROOM INSTRUCTIONAL MATERIALS AND SUPPLIES FOR USE IN A PUBLIC SCHOOL OR A CHARTER SCHOOL, AND THAT FIFTY PERCENT OF SUCH CREDITS SHALL BE AFFORDED TO EDUCATION SCHOLARSHIP ORGANIZATIONS OR FOR HOME-BASED INSTRUCTIONAL MATERIALS, AND FOR THE PURCHASE OF CLASSROOM INSTRUCTIONAL MATERIALS AND SUPPLIES FOR USE IN AN ELIGIBLE RELIGIOUS OR INDEPENDENT SCHOOL; AND (6) ISSUE TO TAXPAYERS ALL AUTHORIZED CERTIFICATES OF RECEIPT FOR ALL ELIGIBLE CREDITS NO LATER THAN JANUARY THIRTY-FIRST FOR CREDITS CLAIMED FOR THE PREVIOUS CALENDAR YEAR. S 6. Excess contributions. Contributions exceeding the allowed annual maximum of one hundred million dollars to public education entities, local education funds and for the purchase of classroom instructional materials and supplies for use in a public school or a charter school, or the allowed annual maximum of one hundred million dollars to educa- tion scholarship organizations, for home-based instructional materials and for the purchase of classroom instructional materials and supplies for use in an eligible religious or independent school, shall be applied to the following tax year, and the donor so notified within one business day. S 7. The department of taxation and finance shall prepare a written report before January 31 of each calendar year, which shall contain statistical information regarding the credits allowed pursuant to subsections (u), (v), (w), (w-1) and (w-2) of section 606 and subdivi- sions 43, 44, 45 and 46 of section 210 of the tax law as added by sections three and four of this act, for the previous calendar year. Copies of such report shall be submitted to the governor, the temporary president of the senate, the speaker of the assembly, the chair of the senate finance committee and the chair of the assembly ways and means committee. Such reports shall contain, but need not be limited to, the number of credits by type and the amount of such credits allowed to taxpayers. S 8. This act shall take effect on the first of January next succeed- ing the date on which it shall have become a law.

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