Florida taxpayers eligible for sales tax breaks for donating to scholarship programs

Taxpayers in Florida have some more options this year to donate to scholarship programs and receive a break on their taxes.

Florida Sales Tax Credit Scholarship Program:

Under legislation that was signed recently by Gov. Rick Scott, those renting or leasing property can receive a 100 percent credit on the sales tax imposed on the fee to rent or lease the property if they contribute to an eligible nonprofit scholarship-funding organization. The credit is available for contributions made by an “eligible business,” which is defined as a tenant or person occupying, using, or entitled to the property subject to the sales tax.  Eligible businesses include commercial tenants who remit sales tax on the rent they pay to their landlord.

As with many scholarship program credits, the eligible business making the contribution may not designate a specific student as the beneficiary of the contribution. Furthermore, the credit may not be claimed on an amended return or through a refund. The credit also must be claimed on an electronically filed return.

This tax credit is capped at $57.5 million a year and is available on a first-come, first-served basis. To receive this credit, the taxpayer must apply to the state Department of Revenue, which will approve the allocation and send notification to both the eligible business/tenant and the landlord. The credit will be taken in the form of a reduction in taxes collected from the eligible business on the sales tax return filed electronically by the landlord.

If the total amount of credits an eligible business may take cannot be fully used, it can be carried forward for 10 years.

Hope Scholarship Program and other nonprofit scholarship-funding organizations:

The state has expanded parents’ access to the Hope Scholarship by allowing students who have been subjected to various types of bullying, threats or other types of harassment in a public school the opportunity to transfer to another public school or to request a scholarship to enroll in or attend an eligible private school.

Effective March 11, 2018, the purchaser of a motor vehicle (except heavy trucks, truck tractor, trailers or motorcycles) will be granted a credit of 100 percent of an eligible contribution made to the Hope Scholarship Program against any Florida sales and use tax imposed and collected by an auto dealer or private tag agent on a purchase made after Oct. 1, 2018.

The eligible contribution is limited to a single payment of $105 per motor vehicle made directly to the dealer, his or her designated agent or a private tag agent. The contribution cannot exceed the state sales and use tax that would otherwise be collected from the purchaser by a dealer, designated agent or private tag agent.