Education Improvement Tax Credit
The Educational Improvement Tax Credit (EITC) program is a project of the Pennsylvania Department of Community and Economic Development (DCED) and offers tax credits for corporate contributions to programs at innovative educational improvement organizations like Pittsburgh Public Theater. This tax credit allows eligible businesses to make contributions to specific programs, like The Public’s annual Shakespeare Monologue & Scene Contest and Create PA workforce development program.
What is the EITC program?
The EITC program permits eligible businesses to earn tax credits equal to either 75% or 90% of their contribution, depending on the company’s length of commitment and up to $750,000, per calendar year. This program allows for-profit businesses to multiply the impact of their donations to qualifying educational improvement organizations, scholarship organizations, and pre-kindergarten scholarship organizations, through cash tax credits granted by the Commonwealth of Pennsylvania to the business upon receipt of donation confirmation. Educational improvement tax credits are limited, and businesses must apply and be accepted to the program each year.
Can my business participate?
To participate in the Pennsylvania EITC program, business must:
- Be a for-profit entity (S Corporation, C Corporation, LLC, or Partnership) based in Pennsylvania or authorized to do business in Pennsylvania
- Have a state tax liability of at least $3,500 for any of these taxes
- Personal income
- Capital stock or foreign franchise
- Corporate net income
- Bank shares
- Title insurance and trust company shares
- Insurance premium (excluding unauthorized, domestic/foreign marine)
- Mutual thrift
- Malt beverage
- Surplus lines
How do I make an EITC-eligible contribution?
All eligible businesses must register with the Pennsylvania Department of Community and Economic Development by each year’s registration deadline. Applications can be submitted in full via the DCED electronic single application system, available here. For detailed instructions on how to create an account and apply for program funding, see the DCED’s guide here. Once a business’ application is approved by the DCED, the company must provide proof to DCED that a qualifying contribution was made within 60 days of the notification letter to the company. Tax credits can be increased from 75% to 90% of the contribution if the business agrees to make same-amount donations for two consecutive tax years. Businesses must reapply in the middle of two-year commitments to verify the continued eligibility of their contribution(s).
When are EITC deadlines?
- May 15–Businesses who have fulfilled their two-year commitment and wish to reapply to renew a two-year commitment
- May 15–Businesses in the middle of a two-year commitment and must verify the continued eligibility of their contribution(s)
- July 1–All other businesses including initial applicants and applicants submitting applications in addition to previously submitted two-year commitments
- Fall–The Pennsylvania DCED determines individual EITC approvals
- Note: This is a competitive program and applications are evaluated on a first-come first-served basis by day received. Applications received on the same day are evaluated at random. Businesses wishing to continue or begin participation in the EITC program should apply early, per advice from the DCED. For the most up-to-date information about deadlines for this program, please visit the DCED online EITC information page.