TITLE 44
Taxation

CHAPTER 44-62
Tax Credits for Contributions to Scholarship Organizations

SECTION 44-62-2


§ 44-62-2. Qualification of scholarship organization.

A scholarship organization must certify annually by December 31st to the division of taxation that the organization is eligible to participate in the program in accordance with criteria as defined below:

(1) "Eligible student" means a school-age student who is registered in a qualified school and is a member of a household with an annual household income of not more than two hundred fifty percent (250%) of the federal poverty guidelines as published in the federal register by the United States department of health and human services.

(2) "Household" means one or more persons occupying a dwelling unit and living as a single nonprofit housekeeping unit. Household does not mean bona fide lessees, tenants, or roomers and borders on contract.

(3) "Household income" means all income received by all persons of a household in a calendar year while members of the household.

(4) "Income" means the sum of federal adjusted gross income as defined in the internal revenue code of the United States, 26 U.S.C. § 1 et seq., and all nontaxable income including, but not limited to, the amount of capital gains excluded from adjusted gross income, alimony, support money, nontaxable strike benefits, cash public assistance and relief (not including relief granted under this chapter), the gross amount of any pension or annuity (including Railroad Retirement Act (see 45 U.S.C. § 231 et seq.) benefits, all payments received under the federal Social Security Act, 42 U.S.C. § 301 et seq., state unemployment insurance laws, and veterans' disability pensions (see 38 U.S.C. § 301 et seq.), nontaxable interest received from the federal government or any of its instrumentalities, workers' compensation, and the gross amount of "loss of time" insurance. It does not include gifts from nongovernmental sources, or surplus foods or other relief in kind supplied by a public or private agency.

(5) "Qualified school" means a nonpublic elementary or secondary school that is located in this state and that satisfies the requirements prescribed by law for nonpublic schools in this state.

(6) "Scholarship organization" means a charitable organization in this state that is exempt from federal taxation under § 501(c)(3) of the internal revenue code, and that allocates at least ninety percent (90%) of its annual revenue through a scholarship program for tuition assistance grants to eligible students to allow them to attend any qualified school of their parents' choice represented by the scholarship organization.

(7) "Scholarship program" means a program to provide tuition assistance grants to eligible students to attend a nonpublic school located in this state. A scholarship program must include an application and review process for the purpose of making these grants only to eligible students. The award of scholarships to eligible students shall be made without limiting availability to only students of one school.

(8) "School-age student" means a child at the earliest admission age to a qualified school's kindergarten program or, when no kindergarten program is provided, the school's earliest admission age for beginners, until the end of the school year, the student attains twenty-one (21) years of age or graduation from high school whichever occurs first.

(9) Designation. A donation to a scholarship organization, for which the donor receives a tax credit under this provision, may not be designated to any specific school or student by the donor.

(10) Nontaxable income. A scholarship received by an eligible student shall not be considered to be taxable income.

History of Section.
(P.L. 2006, ch. 246, art. 24, § 1; P.L. 2010, ch. 239, § 46.)