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What is the Indiana Tax Credit Scholarship?
Tax Credit Scholarships, better known as “SGO Scholarships”, are scholarships awarded by Scholarship Granting Organizations to families to attend the nonpublic school of their choice. SGOs were enacted in 2009, and have been expanded in subsequent years as a key component of the Indiana School Choice effort. Donations to fund SGO scholarships feature a 50% state tax credit for the donor.
Are SGOs and vouchers the same thing?
No. The official name for a Voucher is a “School Choice Scholarship” and the similarity in names is a cause for confusion. One key difference between SGOs and Choice Scholarships is that SGO Scholarships are funded by charitable donations, while Choice Scholarships are funded by state tax distributions.
What is the Tax Credit available to SGO donors?
Donors are eligible to take advantage of a 50% credit against their state tax liability for these contributions.
What about the federal tax deduction?
Your gift is also tax-deductible to the full extent of the federal charitable tax laws because The Lutheran SGO is a 501(c)3 charity. Currently, if you receive the 50% state tax credit for your gift, you may be able to apply the remaining 50% of the gift as a federal tax deduction if you itemize on your federal taxes.
Is there a limit to the tax credit donors could receive?
You can reduce or eliminate up to the full amount you have paid or will owe the state in any given tax year. If already paid, you can receive a refund up to what you have already paid in state taxes. You may roll over the remaining unused credits for up to an additional nine years.
Who can donate to the Lutheran SGO?
Anyone can support SGO scholarships! However, to receive the Tax Credit you must pay or owe Indiana state taxes. Donations can come from individuals, corporations, LLCs, the self-employed, etc. Basically, any “thing” that pays Indiana state taxes.
