A Matter of Choice: Understanding Georgia’s QEE Tax Credit

by | Nov 2, 2019 | GA Taxes, Personal

If you are passionate about school choice, you’ll want to know about Georgia’s Qualified Education Expense (QEE) Tax Credit. Launched in 2008, the program allows individuals, married couples and businesses to claim a dollar-for-dollar tax credit on their Georgia income taxes for donations to qualified preK – 12 schools. Specially designated Student Scholarship Organizations (SSOs) use the contributions to award scholarships so that students can attend private schools chosen by their parents. Several local institutions qualify, including:

  • Fannin Christian Learning Center
  • Josephine Edwards Christian School
  • Mountain Area Christian Academy
  • North Georgia Christian Academy

Currently, Georgia taxpayers can make contributions up to the following limits:

  • Up to $1,000 for single individuals;
  • Up to $1,250 for married individuals;
  • Up to $2,500 for married couples filing jointly;
  • Up to 75 percent of their Georgia income tax liability for “C” corporations; and
  • Up to $10,000 for members of limited liability corporations (LLCs), shareholders in Subchapter “S” corporations, and partners in partnerships.

The amount of tax credit is limited to the donor’s tax liability or actual donation amount, whichever is less.

To earn the credit, go to the GaSSO website and complete the 2020 Tax Credit Form (georgiasso.us/pledge-form) by December 31, 2019. GaSSO will then file your form electronically with the Georgia Department of Revenue, which must pre-approve your donation, as there are only a limited amount of tax credits available each year ($100 million).

If you have a student attending MACA, you can apply for a scholarship for your child through GaSSO. Click this link for the application form: georgiasso.us/scholarship-application-form

Start Saving for College, Too!

Georgia’s Path2College 529 Plan (www.path2college529.com) offers significant tax advantages for those saving for future higher education expenses. Contributions grow tax-deferred, and withdrawals for qualified higher education expenses are tax-free. Funds may be used at virtually any college or university in the United States, and many abroad.

Contributions up to $2,000 per year, per beneficiary, are eligible for a Georgia state income tax deduction for those filing a single return; and $4,000 per year, per beneficiary, for those filling a joint return. The Path2College 520 Plan currently offers seven investment options, and may be opened with as little as $25.

If you’re considering participating in the QEE Tax Credit program and/or Path2College 529 Plan, just let us know and we can provide more details on the potential tax savings.

Do You Need a Sales Tax Permit?

If you’re starting a new business — whether retail, rental or even a home-based business — you may need to charge sales tax. Essentially, anyone selling tangible items in the state of Georgia needs a sales tax permit.

You can easily register your business at the Georgia Tax Center website (gtc.dor.ga.gov/_/#1) by clicking on “Register a New Georgia Business.” Before you do, make sure you have some basic information handy, including:

  • Business name, address, etc.
  • Business type
  • Business history (including any previous state IDs)
  • Business ownership details (including any partners)
  • Withholding information

Note that there is no cost to apply for a sales tax permit in Georgia (there may be other business registration fees). You will not need to renew the permit, though you will need to update it if your address or other information changes. Online registration is quick — your actual permit will arrive in the mail within days after you register.

If you have any questions about your sales tax status or need help registering, give us a call. We can also handle your sales tax payments for you, saving you the time and hassle.

The information provided here by Premier CPA Services PC is for general information only. It does not constitute legal, accounting, tax or other professional advice or services, and is presented without any representation or warranty as to the accuracy or completeness of the information. Please contact us for information as it relates to your circumstances.