Bill > S1813

This bill creates a new tax credit to incentivize charitable donations specifically for creating or expanding charter schools (publicly funded schools that operate with more autonomy from traditional public school systems). The bill allows individual taxpayers to claim a tax credit equal to 75% of their charitable contributions to eligible charter school organizations, with a maximum credit of either 10% of the taxpayer's adjusted gross income or $5,000 per year. To qualify, charter school organizations must meet specific criteria, including being a nonprofit, having a track record of high student performance, maintaining separate financial accounts for charter school contributions, and obtaining independent financial audits. The bill establishes a nationwide volume cap of $5 billion in tax credits annually, with an initial allocation of $10 million to each state and the remainder distributed on a first-come, first-served basis. The bill also includes provisions to ensure that organizations receiving these contributions actually spend the funds on charter school creation and expansion, with requirements to expend at least 85% of contributions within five years and limits on administrative expenses. Importantly, the bill emphasizes organizational autonomy, stating that charter school organizations should not be considered government entities and should have maximum freedom in serving students. The tax credit provisions would take effect for taxable years beginning after December 31, 2025.

Budget and Finance

https://www.congress.gov/bill/119th-congress/senate-bill/1813/all-info