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1326Type of Legislation: General Bill GBIntroducing Body: SenateIntroduced Date: 20000412Primary Sponsor: FairAll Sponsors: Fair and WilsonDrafted Document Number: l:\council\bills\gjk\21205sd00.docCompanion Bill Number: 4753Residing Body: SenateCurrent Committee: Finance Committee 06 SFSubject: Income tax credits, contributions to public schools, scholarship nonprofit funding organizations for child's choice ofHistory Body Date Action Description Com Leg Involved ______ ________ ______________________________________ _______ ____________ ------ 20000418 Companion Bill No. 4753 Senate 20000412 Introduced, read first time, 06 SF referred to Committee Versions of This Bill
TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING SECTION 12-6-3525 SO AS TO AUTHORIZE STATE INCOME TAX CREDITS UP TO FIVE HUNDRED DOLLARS A YEAR ON A PHASED-IN BASIS FOR CONTRIBUTIONS MADE TO PUBLIC SCHOOLS FOR SCHOOL SUPPORT AND TO NONPROFIT SCHOLARSHIP FUNDING ORGANIZATIONS THAT PROVIDE SCHOLARSHIPS FOR CHILDREN TO ATTEND A SCHOOL OF THEIR CHOICE.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. The 1976 Code is amended by adding:
"Section 12-6-3525. (A) The purpose of this section is to:
(1) provide a tax credit for certain contributions to a nonprofit scholarship funding organization or a public school;
(2) enable persons in this State to provide greater financial resources for public schools;
(3) expand educational opportunities for children of families that have limited financial resources; and
(4) enable children in this State to achieve a greater level of excellence in their education.
(B) In enacting this section, the General Assembly recognizes diversity among children and affirms that every child is unique. The General Assembly also affirms that children learn differently from one another and may benefit from expanded educational opportunities.
(C) It is the intent of the General Assembly that freedom of religion of all citizens is inviolate and that nothing in this section be construed to cause excessive governmental entanglement with the religious instruction of a nonpublic school. With respect to a nonpublic school, nothing in this section gives a governmental agency authority to regulate, control, supervise, or in any way be involved in the:
(1) form, manner, or content of religious instruction, ministry, teaching, or curriculum offered by the nonpublic school;
(2) ability of the nonpublic school to select and supervise qualified personnel and otherwise control the terms of employment, including the right to employ individuals who share the religious views of the school;
(3) internal self-governance and autonomy of the nonpublic school; or
(4) religious environment of the nonpublic school, such as symbols, art, icons, and scripture.
(D) As used in this section:
(1) 'Eligible school' means a public or nonpublic primary or secondary school that:
(a) offers a general education to primary or secondary students;
(b) does not discriminate on the basis of race, color, or national origin; and
(c) is located in this State.
(2) 'Nonprofit scholarship funding organization' means a charitable organization that:
(a) is exempt from federal tax under Section 501(a) of the Internal Revenue Code by being listed as an exempt organization in Section 501(c)(3) of the code; and
(b) allocates at least ninety percent of its annual revenue after first-year start-up expenses to providing scholarships for tuition, transportation, and textbook expenses to children enrolled in an eligible school, giving priority to children who demonstrate a need for the scholarships.
(3) 'Person' means an individual, partnership, corporation, or other similar entity.
(E) The tax credits allowed by this section may be applied against any tax imposed by this chapter or against insurance premium taxes or bank license fees.
(F) A person is entitled to a credit under this section for the amount of money the person contributes to a public school. A person is also entitled to a credit under this section for the amount of money the person contributes to a nonprofit scholarship funding organization if:
(1) the contribution is used to provide scholarships for tuition, transportation, or textbook expenses to children enrolled in eligible schools;
(2) the person does not designate a specific child or school as the beneficiary of the contribution; and
(3) the contribution is used to provide scholarships of which at least fifty percent are given to children who have been enrolled in a public school during a previous year or during a prior period immediately before receiving such a scholarship.
(G) The total credits claimed under this section may not exceed one hundred dollars for the year 2000, two hundred dollars for 2001, three hundred dollars for 2002, four hundred dollars for 2003, and five hundred dollars for 2004 and thereafter.
(H)(1) The person must apply for a credit under this section on or with the tax return for the period for which the credit is claimed.
(2) The Department of Revenue shall prescribe the form and manner of proof required to obtain the credit authorized by this section.
(3) A person may claim a credit under this section for a contribution during a particular period only against the tax owed for the corresponding period.
(4) A contribution in excess of the limitation under this section may be carried forward for a period not exceeding five years.
(5) The contribution if claimed as a credit by a taxpayer as permitted by this section may not also be claimed as a charitable deduction by the taxpayer.
(I) A corporation or entity entitled to a credit under this section may not convey, assign, or transfer the credit authorized by this section to another entity unless all of the assets of the entity are conveyed, assigned, or transferred in the same transaction."
SECTION 2. This act takes effect upon approval by the Governor and applies to contributions authorized by Section 12-6-3600 made on or after January 1, 2000.
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