Education Tax Credit: What you should know
The ETC scholarship program is one key step on the road to a more robust economy
As business leaders, you make tough decisions every day. From strategic planning and staffing to competition and the challenging regulatory environment, your business success is measured in large part by your ability to choose the right path forward.
Imagine not being able to choose that right path. Imagine the frustration of knowing what you need to do, but not being able to do it. When we looked beyond our business for help, we found the SBA, a financial advisor, a business mentor – someone who made the difference for us. Now imagine being that person, being the one bridging the gap between success and failure.
Thanks to New Hampshire’s Education Tax Credit program, you can be that lifeline to parents trying to make the right educational decisions for their children. In helping these parents do what’s right, you’re also helping to build the next-generation Granite State workforce: an educated, motivated group of young men and women who will owe their success in no small part to your vision and generosity.
Sadly, too many parents lack the financial resources to exercise their freedom to choose the best education options for their children. This is where the Education Tax Credit program makes the difference between “getting by” and doing well.
Through the ETC, businesses can voluntarily direct some of their profits to private, nonprofit scholarship organizations that provide money to help educate students from families earning up to 300 percent of the poverty level. These K-12 scholarships improve student achievement and reduce inequalities inherent in our ZIP code-based public system. Investment in education puts businesses in the role of actively providing opportunities for students to learn more, do more, and become more.
New Hampshire businesses can receive an 85 percent Education Tax Credit from the state against the business profits tax or the business enterprise tax when donating pre-tax profits to registered 501(c)3 scholarship organizations. When combined with the federal tax deduction, total tax savings can be more then 90 percent.
The tax credits are awarded to businesses from January through June on a first-come, first-served basis until the cap in credits is reached.
Our state is on the wrong side of the demographic curve. Our population is aging faster than we can retain and attract the young, working families upon which businesses depend. We are already one of the oldest states in the nation demographically, and unless we turn around this trend, we will pay a high price in lost economic development.
The ETC scholarship program is one key step on the road to a more robust economy. By giving businesses a choice in how their profits are invested, and giving parents a meaningful choice in how best to educate their children, the ETC puts decision-making authority where it belongs.
Harnessing the power of this “dynamic duo” is the win-win scenario many of our children need to reach their potential, and in so doing, help all of us achieve ours.
Kate Baker is executive director of the Network for Educational Opportunity, the first K-12 scholarship organization to implement the New Hampshire Education Tax Credit Scholarship Program.