Scholarship Tax Credits Program
Donations to Richmond Jewish Foundation’s Education Tax Credit Scholarship Fund will provide scholarships for low-income new students at non-public schools. Individual or business donors receive a tax credit equal to 65% of the donation.
The minimum donation amount is $500. The maximum donation amount for individuals and married couples is $125,000. There is no maximum limit for any business entity.
Individuals can use the tax credits against their Virginia personal income tax liability.
Businesses can claim the Education Improvement Scholarships tax credits against:
- Virginia Corporate Income Taxes
- Virginia Bank Franchise Tax
- Virginia Insurance Premiums License Tax
- Virginia Public Service Corporations Tax
- Personal Income Taxes via pass-through entities such as S-Corporations, LLCs and Partnerships.
The amount of the tax credits may not exceed the donor’s tax liability for the year in which the credit is claimed, but tax credits may be carried over for up to five succeeding years.
In addition to a 65% tax credit, individuals and businesses may also receive a deduction for a charitable contribution, and therefore achieve tax savings in two ways:
- For the year of the donation, they may be able to take a deduction against taxable income as a charitable donation on both their federal and state income taxes.
- The tax reduction equals the contribution amount times the tax rate of the applicable tax (federal or state).
- Subject to rules governing deductibility of charitable contributions
- For the year of the donation, they may take a credit against Virginia taxes.
- Tax reduction equals 65 percent of the amount of the donation.
- Credit is non-transferable.
IMPORTANT: Consult your tax advisor to determine your specific tax savings.
Donating a Scholarship
Donations to Richmond Jewish Foundation’s Education Tax Credit Scholarship Fund under this program are used to provide scholarships at approved schools.
Donors can request that their contributions support scholarships at specific Jewish Day Schools in Virginia,
- However, if those schools do not have enough qualified applicants, the funds will be used for other eligible schools.
- Donors may not direct their funds to support a specific student.
Donors’ direct contributions to schools for other purposes or other scholarships do not qualify for tax credits under this program. Gifts given to approved scholarship tax credit programs, like RJF’s, are eligible for these tax credits.
- Children receiving these scholarships must come from families whose annual household income is less than 300 percent of the current poverty guidelines.
- For children with disabilities, the family’s household income must be no more than 400 percent of the poverty level.
- In addition, the children must be residents of Virginia, and fit one of these criteria:
- are eligible to enter kindergarten or first grade, OR
- attended a Commonwealth public school for at least half of the current or prior school year, OR
- were not Virginia residents during the preceding school year, OR
- were prior recipients of a scholarship under this program.
- A student must first apply through their school to be considered eligible for a tax credit scholarship from RJF.
By statute, at least 90% of the donation must be used to provide scholarships. RJF may use up to 10% of the donation to cover the costs of administrating the scholarship program. Every effort will be made to minimize the administrative costs, in order to provide the maximum in scholarship support.
Process for Obtaining Tax Credits
- Obtain a blank Preauthorization Form.
- Send the completed Letter and Form to RJF, who will submit your Preauthorization Form by secure electronic dropbox to the VA Department of Education (DOE) for approval of your tax credits.
- Within 30 days, the DOE will send you a Preauthorization Notice indicating your tax credits have been approved.
- Return the Preauthorization Notice with your check or securities transfer information to RJF within 180 days of the date of the Notice. (Tax credits become void after 180 days.) Make checks payable to Richmond Jewish Foundation.
After You Have Made Your Donation…
- Within 20 days of receiving your gift, RJF will:
- Send you an acknowledgement of receipt of your gift, and
- Send the DOE a notice that your gift payment has been received, and
- Notify the designated school(s) that your gift has been received.
- Within 30 days of receiving notice of payment, the DOE will issue your Tax Credit Certificate.
- The Tax Credit Certificate must be attached to the tax return in which the credits are being claimed.
- For the year of the donation, you may take a credit against Virginia taxes and for up to five successive years.
Richmond Jewish Foundation does not limit scholarships to students of one school.