Around 600 Alabama businesses and individuals are getting State tax credits – by contributing to private school scholarship programs.
According to the Anniston Star, the tax credits were included, in the Alabama Accountability Act that the Legislature passed in February.
According to reports, 582 donors have given $19.5 million to organizations set up under that new law to provide scholarships to the students who move from failing public schools to participating private schools.
Individuals and businesses receive a dollar-for-dollar State income tax credit, for donations up to a limit; the Accountability Act sets a $25 million annual limit on the total amount of tax credits – individuals can receive a State tax credit for donations up to 50% of tax owed OR a maximum of $7,500. Corporations can receive a tax credit equal to their donations up to 50% of the tax owed.
An architect of the new law Senate President Pro Tem Del Marsh, who recently spoke during the Cherokee County Chamber of Commerce Breakfast for the month of December – said the school choice opportunities offered by the new law outweigh the loss of state income tax revenue which supports public schools.
The Accountability Act provides a tax credit of about $3,500 for any family which moves a child under the law.
To help lower-income families that can’t take advantage of the tax credit that Accountability Act provides that students in families with income up to 150% of the state median, are eligible for the scholarships. Alabama currently has 78 public schools listed as failing, going into the 2013/2014 school year.
State education officials have said 52 students used the new law to transfer from those schools to private schools for the fall term.
The state Department of Education expects to issue an updated list of failing public schools some -time in January.
(Anniston Star/www.annistonstar.com/Associated Press)