Bill Text: MS SB2922 | 2014 | Regular Session | Introduced
Bill Title: Income tax; credit for contributions to organizations that grant scholarships to schools that provide dyslexia therapy.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Failed) 2014-02-26 - Died In Committee [SB2922 Detail]
Download: Mississippi-2014-SB2922-Introduced.html
MISSISSIPPI LEGISLATURE
2014 Regular Session
To: Finance
By: Senator(s) Hill
Senate Bill 2922
AN ACT TO CREATE THE DYSLEXIA THERAPY TAX CREDIT; TO AUTHORIZE AN INCOME TAX CREDIT TO TAXPAYERS IN AN AMOUNT EQUAL TO THE TOTAL CONTRIBUTIONS MADE DURING THE TAXABLE YEAR TO CERTAIN ORGANIZATIONS THAT PROVIDE SCHOLARSHIPS TO STUDENTS ATTENDING ACCREDITED, NONPROFIT, NONPUBLIC SCHOOLS THAT PROVIDE DYSLEXIA THERAPY INSTRUCTION; TO PROVIDE THAT THE CREDIT SHALL NOT EXCEED 50% OF THE TAXPAYER'S INCOME TAX LIABILITY; TO PROVIDE THAT SCHOLARSHIP-GRANTING ORGANIZATIONS MUST MEET CERTAIN REQUIREMENTS IN ORDER FOR A CONTRIBUTION TO THEM TO BE ELIGIBLE FOR THE CREDIT; TO PROVIDE THAT SCHOOLS THAT ACCEPT SCHOLARSHIPS FROM A SCHOLARSHIP-GRANTING ORGANIZATION MUST MEET CERTAIN REQUIREMENTS; TO REQUIRE CERTAIN REPORTS TO BE MADE BY SCHOLARSHIP-GRANTING ORGANIZATIONS TO THE DEPARTMENT OF REVENUE; TO GIVE THE DEPARTMENT OF REVENUE CERTAIN POWERS AND DUTIES WITH REGARD TO THE ADMINISTRATION OF THE CREDIT AUTHORIZED BY THIS ACT; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. This act shall be known and may be cited as the "Dyslexia Therapy Scholarship Tax Credit."
SECTION 2. As used in this act:
(a) "Program" means the Dyslexia Therapy Scholarship Tax Credit Program authorized by this act.
(b) "Eligible student" means a student who is eligible for a scholarship under the Mississippi Dyslexia Therapy Scholarship for Students with Dyslexia Program created in Sections 37-173-1 through 37-173-31.
(c) "Scholarships" means grants to eligible students to cover all or a part of the tuition and fees at a qualified school and/or to cover all or a part of the cost of a comprehensive dyslexia evaluation by a licensed professional listed in Section 37-173-15(1)(b). A grant to pay all or a part of the cost of a comprehensive dyslexia evaluation shall not exceed Eight Hundred Fifty Dollars ($850.00) per child.
(d) "Qualified school" means a not-for-profit, nonpublic school accredited through the Mississippi Association of Independent Schools.
(e) "Parent" includes a guardian, custodian or other person with authority to act on behalf of the child.
(g) "Scholarship-granting organization" means an organization that complies with the requirements of this program and provides scholarships to students attending qualified schools of their parents' choice.
(h) "Department" means the Department of Revenue.
SECTION 3. (1) A taxpayer who files a state income tax return and is not a dependent of another taxpayer shall be allowed a credit against the taxes imposed by Chapter 7, Title 27, Mississippi Code of 1972, for a contribution made to a scholarship-granting organization as provided in this section.
(2) The credit may be claimed by a taxpayer in an amount equal to the total contributions made to a scholarship-granting organization during the taxable year for which the credit is claimed in an amount not to exceed fifty percent (50%) of the taxpayer's income tax liability.
(3) A taxpayer may carry forward the tax credit authorized under this section for three (3) years.
(4) The aggregate amount of tax credits that may be awarded under this section in any one (1) fiscal year shall be Two Hundred Fifty Thousand Dollars ($250,000.00).
SECTION 4. (1) Each scholarship-granting organization shall:
(a) Notify the department of its intent to provide scholarships to students attending qualified schools.
(b) Demonstrate to the department that it has been granted exemption from the federal income tax as an organization described in Section 501(c)(3) of the Internal Revenue Code.
(c) Provide a department-approved receipt to taxpayers for contributions made to the organization.
(d) Ensure that at least ninety percent (90%) of its revenue from donations is spent on scholarships, and that all revenue from interest or investments is spent on scholarships.
(e) Spend each year a portion of its expenditures on scholarships for low-income eligible students equal to the percentage of low-income eligible students in the county where the scholarship-granting organization expends the majority of its scholarships.
(f) Distribute periodic scholarship payments as checks made out to a student's parent or guardian and mailed to the qualified school where the student is enrolled. The parent or guardian must endorse the check before it can be deposited.
(g) Cooperate with the department to conduct criminal background checks on all of its employees and board members and exclude from employment or governance any individual that might reasonably pose a risk to the appropriate use of contributed funds.
(h) Ensure that scholarships are portable during the school year and can be used at any qualified school that accepts the eligible student according to a parent's wishes. If a student moves to a new qualified school during a school year, the scholarship amount may be prorated.
(i) Demonstrate its financial accountability by:
(i) Submitting a financial information report for the organization that complies with uniform financial accounting standards established by the department and conducted by a certified public accountant; and
(ii) Having the auditor certify that the report is free of material misstatements.
(j) Demonstrate its financial viability, if they are to receive donations of Fifty Thousand Dollars ($50,000.00) or more during the school year, by:
(i) Filing with the department prior to the start of the school year a surety bond payable to the state in an amount equal to the aggregate amount of contributions expected to be received during the school year; or
(ii) Filing with the department prior to the start of the school year financial information that demonstrates the financial viability of the scholarship-granting organization.
(2) Each scholarship-granting organization shall ensure that participating schools that accept its scholarship students will:
(a) Comply with all health and safety laws or codes that apply to accredited nonpublic schools;
(b) Hold a valid occupancy permit if required by their municipality;
(c) Certify that they will not discriminate in admissions on the basis of race, color, national origin,
religion or disability.
(d) Provide academic accountability to parents of the students in the program by regularly reporting to the parent on the student's progress.
(3) Scholarship-granting organizations shall not provide scholarships for students to attend any school with paid staff or board members, or relatives thereof, in common with the scholarship-granting support organization.
(4) A scholarship-granting organization shall publicly report to the department by June 1 of each year the following information prepared by a certified public accountant regarding their grants in the previous calendar year:
(a) The name and address of the student support organization;
(b) The total number and total dollar amount of contributions received during the previous calendar year; and
(c) The total number and total dollar amount of scholarships awarded during the previous calendar year, the total number and total dollar amount of scholarships awarded during the previous year to students qualifying for the federal free and reduced lunch program, and the percentage of first-time recipients of scholarships who were continuously enrolled in a public or nonpublic school during the previous year.
SECTION 5. (1) The department shall adopt rules and procedures consistent with this act as necessary to implement the program.
(2) The department shall provide a standardized format for a receipt to be issued by a scholarship-granting organization to a taxpayer to indicate the value of a contribution received. The department shall require a taxpayer to provide a copy of this receipt when claiming the Great Schools Tax Credit.
(3) The department shall provide a standardized format for scholarship-granting organizations to report the information in Section 4(3) of this act.
(4) The department shall have the authority to conduct either a financial review or audit of a student support organization if possessing evidence of fraud.
(5) The department may bar a scholarship-granting organization from participating in the program if the department establishes that the scholarship-granting organization has intentionally and substantially failed to comply with the requirements in Section 4 of this act.
(6) If the department decides to bar a scholarship-granting organization from the program, it shall notify affected scholarship students and their parents of this decision as quickly as possible.
(7) The department shall allow a taxpayer to divert a prorated amount of state income tax withholdings to a scholarship-granting organization of the taxpayer's choice up to the maximum credit allowed by law, including carryover credits. The department shall have the authority to develop a procedure to facilitate this process.
SECTION 6. (1) All qualified schools shall be required to operate in this state.
(2) All qualified schools shall comply with all state laws that apply to nonpublic schools regarding criminal background checks for employees and exclude from employment any people not permitted by state law to work in a nonpublic school.
SECTION 7. This act shall take effect and be in force from and after January 1, 2014.
