On this Giving Tuesday, we wanted to remind our Ohio clients of a unique opportunity to make a positive impact in the community while also benefiting from valuable tax incentives.
Did you know that contributing to scholarship-granting organizations (SGOs) can earn you a nonrefundable, dollar-for-dollar tax credit in Ohio? This means you could be eligible for up to $750 in tax credits (or $1,500 for married couples filing jointly*), directly reducing your state income tax liability.
Here’s a quick overview:
Tax Credits: The credit is a dollar-for-dollar reduction of your Ohio state income tax. It’s limited by either your total tax liability or the amount you donate—whichever is lower.
Federal Charitable Contributions: In some situations, your donation may also qualify as a charitable contribution for federal income tax purposes, doubling the impact of your support.
SGOs are nonprofit organizations that provide private or parochial school scholarships to K-12 students in need. This tax-credit scholarship program began in 2021, and there are currently more than 80 certified SGOs in Ohio.
Tax Time Tip: You must obtain a tax credit receipt from the SGO and provide it to us to submit with your tax return.
*The credit is up to $750 (individual) or $1,500 (married filing jointly). If you file a joint return, each taxpayer will need to make their own $750 contribution to claim the maximum tax credit of $1,500. The credit also is limited to your total Ohio state income tax due for the 2023 tax year. Example: If a married couple owes at least $1,500 of Ohio state tax, they can make qualifying contributions of $750 each at no net cost to them. The donor sends money to the SGO and receives a tax credit from the State of Ohio, which lowers the donors’ tax due by $1,500 (in this example).