Illinois Tax Credit Scholarship Program
Read about the 2019-20 Impact of this program.The Illinois Tax Credit Scholarship Program allows individuals and corporations to donate to approved Scholarship Granting Organizations (SGOs) and receive a credit on their Illinois state taxes in return. An SGO is 501(c)(3) non-profit organization, approved to participate in the Program by the IL Department of Revenue. Under the Program, these SGOs match donor funds to qualifying students as scholarships, with priority given to low-income students. In the case of our school, donors should give to one of two SGOs that will partner with Cristo Rey and to which our families will apply. By law, at least 95% of these contributions must be spent directly on scholarships, with 5% available to the SGO for overhead costs.
Who qualifies for these scholarships?
Students whose families earn 300% of the federal poverty level or less ($90,510 for a family of five) qualify, and priority is given to students who are members of a household whose previous year’s total annual income does not exceed 185% of the federal poverty level ($55,815 for a family of five). At Cristo Rey Jesuit High School, the average family income of our freshmen families is just $41,283 for a family of five – most of our students are in the priority category.
What is the benefit to a donor?
- An individual or corporation will receive a 75% credit on their donation to an approved SGO. (If a donor donates $10,000, they will receive a state tax credit of $7,500.)
- Tax credits by both individual and corporate donors are capped at $1 million (for a $1.33 million donation)
- The credit is non-refundable, but can be carried forward for five subsequent years.
- Donors are prohibited from receiving a federal tax deduction for these donations. You cannot use an Illinois tax credit if you are claiming any part of the scholarship contribution as a federal income tax deduction.
As a donor, what is the process?
- Donors who are new to the program: Create a MyTax Illinois account. To create an account, you must request a “Letter ID” from the Illinois Department of Revenue using the MyTax Illinois website (Individuals menu), sent via U.S. mail within 7-10 business days. Once you receive the “Letter ID,” you will be able to create an account (click here for detailed instructions). Taxpayers should request the “Letter ID” as soon as possible, before the program opens at 12:01am on Jan. 1, 2020, to avoid processing delays. The credits are awarded on a first-come, first-served basis and donors must have a MyTax Illinois account in order to reserve credits (click here for detailed instructions).
- At 12:01am (CST) on Jan. 1, 2020, apply for a "Contribution Authorization Certificate," through your MyTax Illinois account, in the amount you plan to contribute toward the Scholarship Granting Organization. Also, designate the region where you want to donate, not necessarily where you live (Cristo Rey is Region 1), and organization to which your contribution should be directed (click here for detailed instructions).
- Corporate donors may not restrict their contributions to schools, only SGOs. We ask our corporate supporters to continue their regular giving to Cristo Rey or, at least, choose Empower Illinois or Big Shoulders Fund. Individual donors should choose Cristo Rey Jesuit High School as a beneficiary and either Empower Illinois or Big Shoulders Fund as the region 1 pass-through SGO entity.
- You will receive your Contribution Authorization Certificate via your MyTax Illinois account within three days. You then have 60 days to donate the amount reserved to your designated SGO and send them a copy of your Contribution Authorization Certificate.
- After donating, individual donors will receive a certificate of receipt from the SGO indicating a donation was made. The SGO will notify the IL Department of Revenue that a donation was made.
- If a donor does not donate or gives less than they indicated to the IL Department of Revenue, they will not receive ANY tax credit.
- Donors must apply for a new tax credit in January each year.
Corporate Matching Gifts
Many employers offer matching gift programs for charitable donations made by their employees. If your company does have a matching gift program, they should also match gifts made through the Invest in Kids program, provide you with a paper or online form to do so. Identify your chosen SGO on the form, include the SGO's EIN (Empower IL is 27-247941, Big Shoulders Fund SGO is 36-3490557), specify that the match should go to Cristo Rey Jesuit High School, then email the form to either firstname.lastname@example.org or email@example.com.