By Karen M. McCarthy, CPA, AEP, vice president of the Personal Tax Advisory Group at Meaden & Moore. She also serves on the Catholic Community Foundation's Professional Advisor Committee.
New Ohio tax legislation in 2021 makes it possible for individual taxpayers to receive a credit toward their Ohio state income tax liability. Here’s how it works: First, a donation is made to a Scholarship Granting Organization (SGO), which then qualifies the donor to receive 1:1 credit toward their state tax liability. The tax credit is equal to the lesser of the total liability or the contribution amount (up to a maximum of $750 or $1,500 if married filing jointly, where each spouse makes a $750 contribution). The donation must be made by Dec. 31, 2022, to claim the tax credit for 2022 with a tax receipt that is provided by the SGO.
The Catholic Community Foundation and Diocese of Cleveland are collaborating on the Angel Scholarship Fund, an SGO that will generate tuition assistance for students attending one of the 107 schools in the Catholic Diocese of Cleveland. This program is a way to turn tax dollars into tuition for families that seek Catholic education opportunities for their children. Priority is given to families with income below 300% of the poverty threshold.
Contributors to the Angel Scholarship Fund can support schools and students from across the diocese with the greatest financial need through an “undesignated” contribution or by designating a special Catholic school to be the recipient. All Catholic elementary and high school students across the eight county diocese soon will be able to apply for an Angel Scholarship for the 2023-24 school year.
“Catholic schools serve their communities, and the Angel Scholarship Fund is a new opportunity for the community, in turn, to support students to attend a Catholic school,” says Frank O’Linn, superintendent of Catholic schools.
The Diocese of Cleveland Catholic schools comprises the largest school system in Ohio and the sixth largest Catholic school system in the country. Currently, Catholic schools serve 38,312 students in Northeast Ohio. Patrick Grace, executive director of the Catholic Community Foundation, reports that as of September, more than $660,000 has been contributed to the Angel
Scholarship Fund. So far, 98 schools have been earmarked by donors to receive designated contributions. “We’ve had several folks express how great it is for Ohio taxpayers to be able to support Catholic education with no net out-of-pocket cost,” he said.