12/15/2022

Tax Alert: Ohio Scholarship Donation Credit

Beginning in tax year 2021, entities can claim an Ohio tax credit for financial donations made to SGOs

Beginning in tax year 2021, individual taxpayers and pass-through entities can claim an Ohio tax credit for financial donations made to an eligible scholarship granting organization (SGO). The credit equals the lesser of $750 or the total amount donated per individual to SGOs during the tax year. 

This dollar-for-dollar state tax credit will offset the taxpayer’s 2022 Ohio Income tax liability for qualified donations made by December 31, 2022. The taxpayer will receive a 100 percent tax credit for their contribution to be claimed on the 2022 Ohio Income tax return filed in 2023. 

The tax credit is limited to the total Ohio state income tax due throughout the tax year and can be found on page two of their state income tax return (Ohio IT 1040) line 13. Taxpayers may contribute more than $750, but the credit is capped at $750 per taxpayer.  Gifts may qualify as a charitable contribution for federal income tax purposes.

Please select this link to read the complete article from OSAP Strategic Partner Clark Schaefer Hackett (CSH).