Office of Independent Education & Parental Choice
Florida Tax Credit Scholarship Program FAQs
Definition and Eligibility
- What is the Florida Tax Credit Scholarship Program?
The Florida Tax Credit Scholarship Program (FTC) was established in 2001 to provide an income tax credit for corporations that contribute money to nonprofit Scholarship-Funding Organizations (SFOs) that award scholarships to students from families with limited financial resources. In 2009, the program was expanded to provide credits against the insurance premium tax for contributions to eligible non-profit SFOs. In 2010, the program was expanded to provide tax credits against severance taxes on oil and gas production, self-accrued sales tax liabilities of direct pay permit holders, and alcoholic beverage taxes on beer, wine, and spirits. The purpose of the tax credit is to:
- Encourage private, voluntary contributions to nonprofit SFOs;
- Expand education opportunities for children from families that have limited financial resources; and
- Enable children to achieve a greater level of excellence in their education.
- Who is eligible for a scholarship from a nonprofit scholarship-funding organization under this program?
The Florida Tax Credit Scholarship Program no longer requires prior year enrollment in a public school. For the 2014-2015 school year, a student is eligible for a scholarship from a nonprofit SFO through this program, if :
- the student is currently placed, or during the previous state fiscal year was placed, in foster care, OR
- the student qualifies for free or reduced-price school lunches under the National School Lunch Act or is on the direct certification list.
- What are my responsibilities as the parent of a Florida Tax Credit Scholarship recipient?
The parent of an eligible scholarship student must:
- Select an eligible private school and apply for the admission of his or her child;
- Inform the child's school district when the parent withdraws his or her child to attend an eligible private school within 15 days of that decision;
- Ensure the scholarship student remains in attendance throughout the school year unless excused by the school for illness or other good cause;
- Ensure that the student participating in the scholarship program takes the norm-referenced assessment offered by the private school.
- If desired, request from the school district for the student to take the statewide assessment pursuant to s. 1008.22, F.S., and provide transportation to the test site designated by the district;
- Restrictively endorse the scholarship payment to the private school for deposit into the account of the private school.
Additional information related to the Florida Tax Credit Scholarship Program is available directly from Scholarship Funding Organizations
Scholarship Awards and Payments
- What is the maximum award amount of a Florida Tax Credit Scholarship?
The amount of the scholarship provided to any child for the 2014-2015 school year by all eligible nonprofit SFOs must not exceed the following limits:
- $5,272 for a scholarship awarded to a student for enrollment in an eligible private school; or
- $500 for a scholarship awarded to a student for enrollment in a Florida public school that is located outside the district in which the student resides.
- What types of expenses are covered by the scholarships?
Eligible nonprofit SFOs must provide scholarships, from eligible contributions, to qualified students for the following expenses:
- Tuition and fees for an eligible private school or
- Transportation to a Florida public school that is located outside the district in which the student resides.
- How is a scholarship payment made?
The payment will be made by check payable to the studentís parent. If the parent chooses for his or her child to attend an eligible private school, the check must be mailed by the eligible SFO to the private school of the parentís choice, and the parent must restrictively endorse the check to the private school.
The SFO must ensure that the parent endorses the check to the private school of the parentís choice for deposit into the account of the private school.
Scholarship Funding Organizations
- What are eligible nonprofit scholarship-funding organizations?
Eligible nonprofit SFOs are charitable organizations that are exempt from the federal income tax as defined in s. 501(c)(3) of the Internal Revenue Code. Eligible nonprofit SFOs are required to meet the following criteria:
- Provide scholarships from eligible contributions to qualified students;
- Give priority to qualified students who received a scholarship from an eligible SFO during the previous year;
- Expend for annual or partial-year scholarships an amount equal to or greater than 75% of the net eligible contributions remaining after administrative expenses during the state fiscal year in which the contributions are collected;
- Provide a surety bond or letter of credit in an amount equal to 25 percent of the scholarship funds anticipated for each school year or $100,000, whichever is greater.
- May use up to 3% of eligible contributions for administrative expenses if the SFO has operated for the last 3 state fiscal years without negative financial findings; and
- Provide the Auditor General and the Department of Education with an annual financial and compliance audit of their accounts and records conducted by independent certified public accountants.
- Who is responsible for administering the Florida Tax Credit Scholarship Program?
The Department of Revenue (DOR), The Division of Alcoholic Beverages and Tobacco (DABT) of the Department of Business and Professional Regulation, and the Department of Education (DOE) cooperatively administer the Florida Tax Credit Scholarship Program.
The DOE is responsible for adopting rules necessary to determine the eligibility of SFOs and identifying students eligible to participate in the program. The DOE is also responsible for submitting annually, by March 15, a list of eligible SFOs to the DOR and the DABT.
The DOE must annually verify:
- The eligibility of nonprofit scholarship-funding organizations;
- The eligibility of private schools; and
- The eligibility of expenditures.
The DOR is responsible for adopting rules to administer the Florida Tax Credit Scholarship Program, including:
- Establishing application forms and procedures; and
- Governing the allocation of tax credits and carry forward credits for the program on a first-come, first-served basis.