2014 -- S 2473

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LC004748

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2014

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A N   A C T

RELATING TO TAXATION - TAX CREDITS FOR CONTRIBUTIONS TO SCHOLARSHIP

ORGANIZATIONS

     

     Introduced By: Senators Walaska, McCaffrey, and Felag

     Date Introduced: February 27, 2014

     Referred To: Senate Finance

     It is enacted by the General Assembly as follows:

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     SECTION 1. Sections 44-62-3 and 44-62-5 of the General Laws in Chapter 44-62

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entitled "Tax Credits for Contributions to Scholarship Organizations" are hereby amended to read

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as follows:

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     44-62-3. Application for the tax credit program. -- (a) Prior to the contribution, a

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business entity shall apply in writing to the division of taxation. The application shall contain

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such information and certification as the tax administrator deems necessary for the proper

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administration of this chapter. A business entity shall be approved if it meets the criteria of this

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chapter; the dollar amount of the applied for tax credit is no greater than one hundred thousand

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dollars ($100,000) two hundred thousand dollars ($200,000) in any tax year, and the scholarship

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organization which is to receive the contribution has qualified under section 44-62-2.

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      (b) Approvals for contributions under this section shall be made available by the division

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of taxation on a first-come-first-serve basis. The total aggregate amount of all tax credits

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approved shall not exceed one million five hundred thousand dollars ($1,500,000) two million

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dollars ($2,000,000) in a fiscal year.

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      (c) The division of taxation shall notify the business entity in writing within thirty (30)

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days of the receipt of application of the division's approval or rejection of the application.

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      (d) Unless the contribution is part of a two-year plan, the actual cash contribution by the

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business entity to a qualified scholarship organization must be made no later than one hundred

 

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twenty (120) days following the approval of its application. If the contribution is part of a two-

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year plan, the first year's contribution follows the general rule and the second year's contribution

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must be made in the subsequent calendar year by the same date.

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      (e) The contributions must be those charitable contributions made in cash as set forth in

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the Internal Revenue Code.

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     44-62-5. Limitations. -- (a) The credit shall not exceed one hundred thousand dollars

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($100,000) two hundred thousand dollars ($200,000) annually per business entity.

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      (b) The tax credit must be used in the tax year the contribution was made. Any amounts

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of unused tax credit may not be carried forward. The tax credit is not refundable, assignable or

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transferable. The tax credit may not reduce the tax below the state minimum tax.

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      (c) The credit allowed under this chapter is only allowed against the tax of that

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corporation included in a consolidated return that qualifies for the credit and not against the tax of

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other corporations that may join in the filing of a consolidated tax return.

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     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO TAXATION - TAX CREDITS FOR CONTRIBUTIONS TO SCHOLARSHIP

ORGANIZATIONS

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     This act would increase the dollar amount of the tax credit that a single business entity

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could obtain for contributions to scholarship organizations from one hundred thousand dollars

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($100,000) to two hundred thousand dollars ($200,000) in any tax year. The act would also

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increase the total aggregate amount of tax credits that could be approved by the division of

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taxation in a fiscal year from one million five hundred thousand dollars ($1,500,000) to two

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million dollars ($2,000,000).

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     This act would take effect upon passage.

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