House Bill 1133

Committee Chair: Larry O’Neal

Committee:Ways & Means

House Sponsor: David Casas

Chairman O’Neal’s opinion of the legislation:

HB 1133 provides income tax credits to taxpayers that provide funds to “student scholarship organizations”, which are defined as 501(c)(3) organizations that allocate 90% of annual revenue for scholarships or tuition grants to allow students to attend private schools and provide educational scholarships or tuition grants to students without limiting availability to only students of one school. 

The bill provides for tax credits to taxpayers that provide funds to these organizations when such funds are used for private school tuition and fees.  The amount of the credit for individual taxpayers will be the lesser of the actual amount expended or $1,000 per tax year for single or head of household taxpayers, and $2,500 for married couples filing jointly.  The amount of the credit for corporations will be the lesser of the actual amount expended or 75% of the corporation’s income tax liability.  This credit is not allowed if the expenditure to the organization is for the direct benefit of any dependent taxpayer.  Any unused credit may be carried forward against the five succeeding years’ tax liability.  The aggregate amount of these tax credits shall not exceed $50 million per tax year. 

In order to receive this credit, taxpayers must notify the Department of Revenue of the total amount of contributions that the taxpayer intends to make prior to making the contribution.  The Commissioner then pre-approves or denies the requested amount within 30 days.  If pre-approved, the taxpayer must make the contribution within 30 days.  The taxpayer must attach a letter of confirmation of the donation issued by the student scholarship organization must be attached to the tax return.

This bill comes to the House Floor under the Structured Rule.